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Full text of "North Carolina Register v.6 no. 22 (2/14/1992)"

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The 
JSTORTH CAROLINA 

REGISTER 



IN THIS ISSUE 



SI 



; TiORTH 



TITU 
1TIOM 



CORRECTION 

Wildlife Resources Commission 

FINAL DECISION LETTER 

TAX REVIEW BOARD 

PROPOSED RULES 
Agriculture 

Cosmetic Art Examiners 
Economic and Community Development 
Environment, Health, and Natural Resources 
Human Resources 
Insurance 
Labor 
Public Education RECEIVED 



FINAL RULES 
Revenue 

RRC OBJECTIONS 



FEB 20 1992 
LAW LIBRARY 



RULES INVALIDATED BY JUDICIAL DECISION 

ISSUE DATE: FEBRUARY 14, 1992 
Volume 6 • Issue 22 • Pages 1637-1741 



INFORMATION ABOUT THE NORTH CAROLINA REGISTER AND ADMINISTRATIVE CODF, 



NORTH CAROLINA REGISTER 



TEMPORARY RULES 



The North Carolina Register is published twice a month and 
contains information relating to agency, executive, legislative and 
judicial actions required by or affecting Chapter 150B of the 
General Statutes. All proposed administrative rules and notices of 
public hearings filed under G.S. 150B-21.2 must be published in 
the Register. The Register will typically comprise approximately 
fifty pages per issue of legal text. 

State law requires that a copy of each issue be provided free of 
charge to each county in the state and to various state officials and 
institutions. 

The North Carolina Register is available by yearly subscription 
at a cost of one hundred and five dollars ($105.00) for 24 issues. 
Individual issues may be purchased for eight dollars ($8.00). 

Requests for subscription to the North Carolina Register should 
be directed to the Office of Administrative Hearings, 
P. 0. Drawer 27447, Raleigh, N. C. 27611-7447. 



Under certain emergency conditions, agencies may issue 
temporary rules. Within 24 hours of submission to OAH, the 
Codifier of Rules must review the agency's written statement of 
findings of need for the temporary rule pursuant to the provisions in 
G.S. 150B-21.1. If the Codifier determines that the findings meet 
the criteria in G.S. 150B-21.1, the rule is entered into the NCAC. If 
the Codifier determines that the findings do not meet the criteria, 
the rule is returned to the agency. The agency may supplement its 
findings and resubmit the temporary rule for an additional review 
or the agency may respond that it will remain with its initial 
position. The Codifier, thereafter, will enter the rule into the 
NCAC. A temporary rule becomes effective either when the 
Codifier of Rules enters the rule in the Code or on the sixth 
business day after the agency resubmits the rule without change. 
The temporary rule is in effect for the period specified in the rule or 
180 days, whichever is less. An agency adopting a temporary rule 
must begin rule-making procedures on the permanent rule at the 
same time the temporary rule is filed with the Codifier. 



ADOPTION AMENDMENT, AND REPEAL OF 
RULES 



NORTH CAROLINA ADMINISTRATIVE CODE 



The following is a generalized statement of the procedures to be 
followed for an agency to adopt, amend, or repeal a rule. For the 
specific statutory authority, please consult Article 2A of Chapter 
150B of the General Statutes. 

Any agency intending to adopt, amend, or repeal a rule must 
first publish notice of the proposed action in the North Carolina 
Register. The notice must include the time and place of the public 
hearing (or instructions on how a member of the public may request 
a hearing); a statement of procedure for public comments; the text 
of the proposed rule or the statement of subject matter; the reason 
for the proposed action; a reference to the statutory authority for the 
action and the proposed effective date. 

Unless a specific statute provides otherwise, at least 15 days 
must elapse following publication of the notice in the North 
Carolina Register before the agency may conduct the public 
hearing and at least 30 days must elapse before the agency can take 
action on the proposed rule. An agency may not adopt a rule that 
differs substantially from the proposed form published as part of 
the public notice, until the adopted version has been published in 
the North Carolina Register for an additional 30 day comment 
period. 

When final action is taken, the promulgating agency must file 
the rule with the Rules Review Commission (RRC). After approval 
by RRC, the adopted rule is filed with the Office of Administrative 
Hearings (OAH). 

A rule or amended rule generally becomes effective 5 business 
days after the rule is filed with the Office of Administrative 
Hearings for publication in the North Carolina Administrative Code 
(NCAC). 

Proposed action on rules may be withdrawn by the promulgating 
agency at any time before final action is taken by the agency or 
before filing with OAH for publication in the NCAC. 



The North Carolina Administrative Code (NCAC) is a 
compilation and index of the administrative rules of 25 state 
agencies and 38 occupational licensing boards. The NCAC 
comprises approximately 15,000 letter size, single spaced pages of 
material of which approximately 35% of is changed annually. 
Compilation and publication of the NCAC is mandated by G.S. 
150B-21.18. 

The Code is divided into Titles and Chapters. Each state agency 
is assigned a separate title which is further broken down by 
chapters. Title 21 is designated for occupational licensing boards. 

The NCAC is available in two formats. 

(1) Single pages may be obtained at a minimum cost of 
two dollars and 50 cents (S2.50) for 10 pages or less, 
plus fifteen cents (SO. 15) per each additional page. 

(2) The full publication consists of 53 volumes, totaling in 
excess of 15,000 pages. It is supplemented monthly 
with replacement pages. A one year subscription to the 
full publication including supplements can be 
purchased for seven hundred and fifty dollars 
($750.00). Individual volumes may also be purchased 
with supplement service. Renewal subscriptions for 
supplements to the initial publication are available. 

Requests for pages of rules or volumes of the NCAC should be 
directed to the Office of Administrative Hearings. 



CITATION TO THE NORTH CAROLINA 
REGISTER 

The North Carolina Register is cited by volume, issue, page 
number and date. 1:1 NCR 101-201, April 1, 1986 refers to 
Volume 1, Issue 1, pages 101 through 201 of the North Carolina 
Register issued on April 1, 1986. 



FOR INFORMATION CONTACT: Office of 
Administrative Hearings, ATTN: Rules Division, P.O. 
Drawer 27447, Raleigh, North Carolina 27611-7447, (919) 
733-2678. 



NORTH 
CAROLINA 
REGISTER 




Office of Administrative Hearings 

P.O. Drawer 27447 

Raleigh, \C 27611-7447 

(919) 733 - 267S 



Julian Mann III, 

Director 
James R. Scarcella Sr., 

Deputy Director 
Molly Masich, 

Director A PA Services 



Staff: 

Ruby Creech, 

Publications Coordinator 
Teresa Kilpatrick, 

Editorial Assistant 
Jean Shirley, 

Editorial Assistant 



ISSUE CONTEN I S 



I. CORRECTION 

Wildlife Resources Commission .1637 



II. FINAL DECISION LETIER 

Voting Rights Act 1640 

III. TAX REVIEW BOARD 

Orders of Board 1641 

IV. PROPOSED RULES 

Agriculture 

Markets 1642 

Plant Industry 1642 

Veterinary Division 1645 

Economic and Community 

Development 

Alcoholic Beverage Control 

Board 1648 

Environment, Health, and 

Natural Resources 

Land Resources 1720 

Human Resources 

Medical Assistance 1703 

Insurance 

Engineering and Building 

Codes 1704 

Labor 

Elevator and Amusement 

Device Division 1712 

Licensing Board 

Cosmetic Art Examiners 1723 

Public Education 

Elementary and Secondary 1721 

V. FINAL RULES 

Revenue 

Departmental Rules 1729 

VI. RRC OBJECTIONS 1731 

VII. RULES INVALIDATED BY 

JUDICIAL DECISION 1736 

VIII. CUMULATIVE INDEX 1738 



NORTH CAROLINA REGISTER 

Publication Schedule 

(January 1992 - December 1992) 



Issue 


Last Day 


Last Day 


Earliest 


Earliest 


Last Day 


* 


Date 


for 


for 


Date for 


Date for 


to 


Earliest 




Filing 


Electronic 


Public 


Adoption 


Submit 


Effective 






Filing 


Hearing 


by 

Agency 


to 
RRC 


Date 


******************************************************************* 


01/02 92 


12/09/91 


12/16/91 


01/17/92 


02/01/92 


02/20/92 


04/01/92 


01/15/92 


12/20/91 


12/31 91 


01/30/92 


02 14 92 


02,20/92 


04/01/92 


02/03/92 


01/10/92 


01/17/92 


02/18/92 


03/04, 92 


03,20/92 


05/01/92 


02/14/92 


01/24/92 


01/31/92 


02/29/92 


03/15/92 


03,20/92 


05/01/92 


03/02/92 


02/10/92 


02/17/92 


03/17/92 


04/01/92 


04/20/92 


06/01/92 


03/16/92 


02/24/92 


03/02/92 


03/31/92 


04/15/92 


04/20/92 


06/01/92 


04/01/92 


03/11/92 


03 18 92 


04/16/92 


05 01 92 


05 20/92 


07/01/92 


04/15/92 


03/25/92 


04/01 92 


04/30/92 


05/15 92 


05/20/92 


07 01/92 


05/01/92 


04/10/92 


04/17/92 


05/16/92 


05/3 L 92 


06,20/92 


08/03/92 


05/15/92 


04/24/92 


05/01/92 


05/30/92 


06/ 14 '92 


06/20/92 


08/03/92 


06/01/92 


05/11/92 


05/18/92 


06 16/92 


07/01 92 


07 20/92 


09/01/92 


06/15/92 


05/22/92 


06/01/92 


06/30/92 


07/15/92 


07,20/92 


09 01/92 


07/01/92 


06/10/92 


06/17/92 


07/16/92 


07/31/92 


08, 20/92 


10/01/92 


07/15/92 


06/24/92 


07/01/92 


07/30/92 


08/14 92 


08/20/92 


10/01/92 


08/03/92 


07/13/92 


07/20/92 


08/18/92 


09/02/92 


09/20/92 


11/02/92 


08/14/92 


07/24/92 


07/31/92 


08/29/92 


09/13 92 


09/20/92 


11 02/92 


09/01/92 


08/11/92 


OS IS 92 


09/16/92 


10/01 92 


10,20/92 


12 01 92 


09/15/92 


08/25/92 


09/01/92 


09 30/ 92 


10/15 92 


10,20,92 


12/01/92 


10/01/92 


09/10/92 


09/17/92 


10/16/92 


10/31/92 


11,20/92 


01/04/93 


10/15/92 


09/24/92 


10,01,92 


10 30/92 


11/14 92 


11,20/92 


01/04/93 


11/02/92 


10/12/92 


10.19 92 


11/17/92 


12/02 92 


12 20/92 


02/01/93 


11/16/92 


10/23/92 


10/30/92 


12/01/92 


12/16 92 


12/20/92 


02/01/93 


12/01/92 


11/06/92 


11/13 92 


12/16/92 


12 31 92 


01/20/93 


03/01/93 


12/15/92 


11 24 92 


12 01 92 


1230/92 


01/14 93 


01,20/93 


03'01/93 



* The "Earliest Effective Date" is computed assuming that the agency follows 
the publication schedule above, that the Rules Review Commission approves the 
rule at the next calendar month meeting after submission, and that RRC delivers 
the rule to the Codifier of Rules five (5 J business days before the 1st business 
day of the next calendar month. 



CORRECTION 



WILDLIFE RESOURCES COMMISSION 



15ANCAC IOC .0305 



Correction to the notice as published in the NORTH CAROLINA REGISTER, Volume 6, Issue 20, 
pages 1542-1545 on January 15, 1992. 

In entering the notice for publication in the Register, the amendment to Paragraph (a) to change the 
creel and size limits for Red Drum was not shown. The amendment as filed by the agency is shown 
in BOLD ITALIC. 

The Wildlife Resources Commission will extend the comment deadline from February 15, 1992 to 
March 3, 1992. Written comments must be delivered or mailed to the N.C. Wildlife Resources Com- 
mission, 512 N. Salisbury Street, Raleigh, NC 27604-1188. 



****************** 

IVotice is hereby given in accordance with G.S. 
I50B-2I.2 that the North Carolina Wildlife Re- 
sources Commission intends to amend rule(s) 
cited as 15 NCAC IOC .0305. 

1 he proposed effective date of this action is April 
I, 1992. 

1 he public hearing will be conducted at 10:00 
a.m. on January 30, 1992 at Room 386, Archdale 
Building, 5/2 N. Salisbury St., Raleigh, NC 
27604-1 188. 



I\eason for Proposed Action: To provide con- 
sistent creel and size limits and seasons for striped 
bass and consistent creel and size limits for red 
drum. 

O omment Procedures: Interested persons may 
present their views either orally or in writing at the 
hearing. In addition, the record of hearing will 
be open for receipt of written comments from 
January 15, 1992 to February 15, 1992. Such 
written comments must be delivered or mailed to 
the N.C. Wildlife Resources Commission, 512 N. 
Salisbury St., Raleigh, NC 27604-1 188. 



CHAPTER 10 - WILDLIFE RESOURCES AND WATER SAFETY 

SUBCHAPTER IOC - INLAND FISHING REGULATIONS 

SECTION .0300 - GAME FISH 

.0305 OPEN SEASONS: CREEL AND SIZE LIMITS 

(a) Generally. Subject to the exceptions listed in Paragraph (b) of this Rule, the open seasons and 
creel and size limits are as indicated in the following table: 





DAILY CREEL 


MINIMUM 




GAME FISHES 


LIMITS 


SIZE LIMITS 


OPEN SEASON 


Mountain Trout: 








Wild Trout 


4 


7 in. 


All year 


Waters 




(exc. 15) 


(exc. 2) 


Hatchery Sup- 


7 


None 


All year, except 


ported Trout 






March 1 to 7:00 a.m. 


Waters 






on first Saturday 
in April 
(exes. 2 & 3) 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1637 



CORRECTION 



Muskellunge 
and Tiger Musky 


2 


30 in. 


ALL YEAR 


Chain Pickerel 
(Jack) 


None 


None 


ALL YEAR 


Walleye 


8 

(exes. 9 & 10) 


None 
(exc. 9) 


ALL YEAR 


Sauger 


S 


15 in. 


ALL YEAR 


Black Bass: 
Largemouth 


5 

(exc. 10) 


14 in. 
(exes. 4, 
8& 11) 


ALL YEAR 

(exc. 13) 


Smallmouth 
and Spotted 


5 

(exc. 10) 


12 in. 
(exes. 4, 

8& 11) 


ALL YEAR 


White Bass 


25 


None 


ALL YEAR 


Sea Trout (Spot- 
ted or Speckled) 


None 


12 in. 


ALL YEAR 


Flounder 


None 


13 in. 


ALL YEAR 


Red drum (channel 
bass, red fish, 
puppy drum) 


\onc 5 


U 18 in. 


ALL YEAR 


Striped Bass 
and their hybrids 
(Morone Hybrids) 


8 aggregate 
(exes. 1 & 6) 


16 in. 
(exes. 1, 
6& 12) 


ALL YEAR 

(exes. 6 & 16) 


Kokanee Salmon 


7 


None 


ALL YEAR 


Panfishes 


None 

(exes. 5 & 14) 


None 
(exc. 14) 


ALL YEAR 

(exc. 5) 


NONGAME FISHES 


None 


None 


ALL YEAR 

(exc. 7) 



(b) 
(1 



(^ 



(3) 

(4) 

(5) 



Exceptions 

In the Dan River upstream from its confluence with Bannister River to the Brantly Steam Plant 
Dam, and in John II. Kerr, Gaston, and Roanoke Rapids Reservoirs, the creel limit on striped 
bass and Morone hybrids is four in the aggregate and the minimum size limit is 20 inches. 

In designated public mountain trout waters the season for taking all species of fish is the same 
as the trout fishing season. There is no closed season on taking trout from Nantahala River and 
all tributaries (excluding impoundments) upstream from Nantahala Lake, and the impounded 
waters of power reservoirs and municipally-owned water supply reservoirs open to the public for 
fishing. 

Under an agreement with Tennessee, the minimum size limit on trout in Calderwood Reservoir 
is seven inches. 

Bass taken from streams designated as public mountain trout waters or from Calderwood Res- 
ervoir may be retained without restriction as to size limit. 

On Mattamuskeet Lake, special federal regulations apply. 



163S 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



CORRECTION 



(6) In the inland fishing waters of Cape Fear, Xeuse and Tar Rivers and their tributaries extending 
upstream to the first impoundment, the daily creel limit for striped bass and their hybrids is one 
fish and the minimum length limit is 18 inches. In the Roanoke River up to the first 
impoundment, from July 1 through March 31 and June 1 through June 30 the daily creel limit 
for stripped bass is one fish and the minimum length limit is 18 inches; from April 1 to May 31 
the daily creel limit is three fish, no fish between the lengths of 22 inches and 27 inches may be 
retained, and the minimum length limit is 16 inches, except no fish may be retained in Roanoke 
River and its tributaries including Cashie, Middle and Eastmost rivers from Mav 1 to December 
31, 1991. 

(7) See 15A NCAC IOC .0407 for open seasons for taking nongame fishes by special devices. 

(8) The maximum combined number of black bass of all species that may be retained per day is 
five fish, no more than two of which may be smaller than the applicable minimum size limit. 
The minimum size limit for all species of black bass is 14 inches, with no exception in Lake Luke 
Marion in Moore County, in Reedy Creek Park lakes in Mecklenburg County, and in Currituck 
Sound and tributaries north of Wright Memorial Bridge; in North River and tributaries in 
Currituck and Camden Counties north of a line between Camden Point and the end of SR 1 124. 
In and west of Madison, Buncombe, Henderson and Polk Counties the minimum size limit is 
12 inches. In B. Everett Jordan Reservoir a minimum size limit of 16 inches, with no exception, 
applies to largemouth bass. In Falls of Neuse Reservoir, east of SR 1004, Sutton Lake and 
Tuckertown Lake no black bass between the lengths of 12 inches and 16 inches may be retained, 
and the minimum size limit for black bass is 16 inches, except that the daily creel may contain 
two black bass of less than 12 inches in length. In W. Kerr Scott Reservoir there is no minimum 
size limit for spotted bass. 

(9) A minimum size limit of 15 inches applies to walleye taken from Lake James and its tributaries, 
and the daily creel limit for walleye is four fish in Linville River upstream from the NC 126 
bridge above Lake James. 

(10) The creel limit for black bass and walleye taken from Calderwood Reservoir is 10. 

(11) The minimum size limit for all black bass, with no exception, is IS inches in the following 
trophy bass lakes: 

(A) Cane Creek Lake in Lnion County; and 

(B) Lake Thom-A-Lex in Davidson County. 

(12) In all impounded inland waters and their tributaries, except those waters described in Ex- 
ceptions (1), the daily creel limit of striped bass and their hybrids may include not more than 
two fish of smaller size than the minimum size limit. 

(13) In Cane Creek Reservoir (Orange County) the season for taking largemouth bass is closed. 

( 14) In Lake Tillery, Falls Lake, Badin Lake, and Tuckertown Lake a daily creel limit of 20 fish and 
a minimum size limit of 8 inches apply to crappie. 

(15) In Slick Rock Creek the minimum size is 7 inches for brook trout and 10 inches for brown and 
rainbow trout. 

(16) In designated inland fishing waters of Roanoke Sound, Croatan Sound, Albemarle Sound, 
Chowan River, Currituck Sound, Alligator River, Scuppernong River, and their tributaries (ex- 
cluding the Roanoke River and Cashie River and their tributaries), striped bass fishing season, 
size limits and creel limits shall be the same as those established by duly adopted rules of is 
closed when adjacent joint b* coastal fishing wat e rs aw closed te- hook m4 few fishing fof striped 
bass bv the Marine Fisheries Commission. 



Statutory Authority G.S. 113-134; 113-292; 113-304; 113-305. 



6:22 NORTH CAROLINA REGISTER February 14, 1992 16.19 



VOTING RIGHTS ACT FINAL DECISION LETTER 



[G.S. 120-30.911, effective July 16, 1986, requires that all letters and other documents issued by the 
Attorney General of the United States in which a final decision is made concerning a "change af- 
fecting voting" under Section 5 of the Voting Rights Act of J 965 be published in the North Carolina 
Register. / 



U.S. Department of Justice 
Civil Rights Division 

JRD:SSC:NG:lrj 

DJ 166-012-3 Voting Section 

91-1636 P.O. Box 66128 

Washington, D.C. 20035-6128 

July 3, 1991 

Kenneth R. Hoyle, Esq. 

Lee County Attorney 

P. O. Box 1968 

Sanford, North Carolina 27331-1968 

Dear Mr. Hoyle: 

This refers to the relocation of the Board of Elections office in Lee County, North Carolina, sub- 
mitted to the Attorney General pursuant to Section 5 of the Voting Rights Act of 1965, as amended, 
42 L'.S.C. 1973c. We received your submission on May 29, 1991. 

The Attorney General does not interpose any objection to the specified change. However, we note 
that Section 5 expressly provides that the failure of the Attorney General to object does not bar sub- 
sequent litigation to enjoin the enforcement of the change. In addition, as authorized by Section 5, 
we reserve the right to reexamine this submission if additional information that would otherwise require 
an objection comes to our attention during the remainder of the sixty-day review period. See the 
Procedures for the Administration of Section 5 (28 C.F.R. 51.41 and 51.43). 

Sincerely, 

John R. Dunne 

Assistant Attorney General 

Civil Rights Division 

By: 



Gerald W. Jones 
Chief, Votine Section 



1640 6:22 NORTH CAROLINA REGISTER February 14, 1992 



ORDERS OF THE TAX REVIEW BOARD 



[This Section contains ORDERS of the TAX REVIEW BOARD issued under G.S. 105-241.2.] 



STATE OF NORTH CAROLINA 



BEFORE THE TAX REVIEW BOARD 



COUNTY OF WAKE 



ADMINISTRATIVE 
DECISION NUMBER: 



265 



In the matter of: 
The Proposed Assessments of 
Additional Withholding Tax for 
the Quarterly Periods Ending 
31 March 1988, 30 June 1988, and 
30 September 1988 by the Secretary 
of Revenue against 2 1 st Century 
Builders, a partnership. 

THIS MATTER was heard before the undersigned duly appointed and acting members of the Tax 
Review Board at its regular meeting in the City of Raleigh on 18 December 1991, upon Petition of 
21ST CENTURY BUILDERS, a partnership, through its principal partner, LARRY W. ROARK, 
for review of a Final Decision of the Deputy Secretary of Revenue sustaining proposed assessments of 
additional withholding tax for the quarterly periods ending 31 March 1988, 30 June 1988, and 30 Sep- 
tember 1988; 

AND IT APPEARING TO THE BOARD that matters were raised by the Petitioner at the 
hearing before the Board regarding: (1) the nature of the Petitioner's business arrangements with 
persons deemed by the Department of Revenue to be employees of the Petitioner and (2) the particular 
nature of the work performed by certain persons deemed by the Department of Revenue to be em- 
ployees of the Petitioner as the trade of such persons bears on the question of whether they were em- 
ployees of the Petitioner; that such evidence was not presented by the Petitioner at the hearing before 
the Deputy Secretary of Revenue; that such evidence is material to the issues raised in the Petitioner's 
Petition, is not cumulative, and could not reasonably have been presented at the hearing before the 
Deputy Secretary of Revenue; 

IT IS THEREFORE ORDERED that the Petitioner's case is remanded to the Deputy Secretary 
of Revenue, where the Petitioner shall have the opportunity to present additional evidence to be taken 
and ruled upon by the Deputy Secretary. 

Entered in the City of Raleigh this 30th day of January, 1992. 



TAX REVIEW BOARD 



Harlan E. Boyles, Chairman 
State Treasurer 



William W. Redman, Jr. 
Chairman, Utilities Commission 



Jeff D. Batts 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1641 



PROPOSED RULES 



TITLE 2 - DEPARTMENT OF 
AGRICULTURE 

iV otice is hereby given in accordance with G.S. 
150B-21.2 that the N. C. Board of Agriculture in- 
tends to adopt rule(s) cited as 2 NCAC 48 A 
.0239, .0240, .0241; 52E .0103 and amend rule(s) 
cited as 2 NCAC 43 L .0202; 4SA .0601, .0608, 
.0611; 52B .0204, .0207, .0209, .02/0. and .0212. 

1 he proposed effective date of this action is May 
1, 1992. 

1 he public hearing will be conducted at 10:00 
a.m. on March 19, 1992 at the Gov. James B. 
Hunt, Jr. Horse Complex (Restaurant), 4601 
Trinity Rd., Raleigh, NC 27607. 

IXeason for Proposed Action: 

Rule 2 NCAC 43L .0202 - Increases gate fees for 
Charlotte Farmers Market. 



Rules 2 NCAC 48 A .0239; .0240; .0241 - Establishes 
procedures for obtaining permit to sell bees and 
adopts forms. 

Rules 2 NCAC 48 A .0601; .0608; .0611 - Changes 

boll weevil eradication program rules by eliminat- 
ing provisions for delayed payment of fees, by 
changing method of assessing penalties and inter- 
est for late payment or under-reporting of acreage. 

Rules 2 NCAC 52B .0204; .0207; .0209; .0210; .0212 

- Changes requirements for importation of cattle, 
swine, sheep, birds and wild animals. 

Rule 2 NCAC 52E .0103 - Establishes requirements 
for sale of cattle which have been sold through a 
livestock market within the previous 21 days. 

Comment Procedures: Interested persons may 
present statements either orally or in writing at the 
public hearing or in writing prior to the hearing 
by mail addressed to David S. McLeod. Secretary 
of the North Carolina Board of Agriculture, P.O. 
Box 27647, Raleigh, NC 27611. 



CHAPTER 43 - MARKETS 



SUBCHAPTER 43L - MARKETS 



SECTION .0200 - FEES: CHARLOTTE FARMERS MARKET 



.0202 GATE FEES 

The following gate fees shall be paid upon entering the market: 

(1) Retail Shed A 

(a) March through Octobor 
November 

(b) November December through February 

(2) Retail Building Building B aed Q 
(a) 



Day 



ssm 


$6.00 


\ QQ 


5.00 


fi QQ 
fc QQ 

10.00 


7.00 
7.00 



Week 



$20.00 $25.00 



2&M 
20.00 



30.00 



March through September 

(b) October through February 

(c) May through August - 
Saturdays only 

(d) North Carolina farmers shall not be subject to the charges set forth in Subparagraph (2)(c) of 
this Rule. 

5.00 
8.00 
4.00 



(3} Retail Building C 
(4) @$ Fighteen Wheelers 
[5] (4> Deliveries 



Statutory Authority G.S. 106-22; 106-530. 

CHAPTER 48 - PLANT INDUSTRY 
SUBCHAPTER 48A - PLANT PROTECTION 
SECTION .0200 - HONEY AND BEE INDUSTRY 
.0239 PERMIT TO SELL BEES 



(a) The Plant Industry Division of the North 
Carolina Department ot Agriculture is responsi- 
ble for the issuing of permits to individuals, cor- 
porations, or firms intending to sell honeybees in 
North Carolina. 



(b) Permitting Procedure: 
( 1) Individuals, corporations, or firms desiring 
to sell bees in North Carolina shall apply 



1642 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



for a permit. The permitting period will 
be from January ]_ to December 31 of 
each year. Permit applications must be 
on a form provided by the Plant Industry 
Division. Permit forms are available from 
the following: 



(A) North Carolina Department of Agri- 
culture 
Plant Industry Division 
P.O. Box 27647 
Raleigh, NC 27611 
(B) Apiculturist, Entomology Department 
N, C. State University 
1114 GrinneUs 
Box 7626 
Raleigh, NC 27695 
(C) All agricultural extension offices; 

(2) A permitting fee of twenty-five dollars 
($25.00) must be paid on an annual basis 
for each separate permit; 

(3) Individuals, corporations, or firms may 
obtain a permit to sell bees at any time 
of year; 

(4) The permit will expire on December 3]_ 
of each year and must be renewed each 
year; 

(5) All provisions of the N. C. Bee and Honey 
Act and the rules adopted thereunder 
must be met as a prerequisite to obtaining 
a permit to sell bees, including existing 
quarantines; 

(6) A permit to sell bees in North Carolina 
can be denied or revoked in order to 



Q 



vent the introduction or spread of bees or 
colonies with contagious or infectious 
diseases, disorders, or conditions deemed 
harmful to the North Carolina beekeeping 
industry; 

A permit is non-transferable; all bees sold 
by the individual, corporation, or firm 
listed on the permit must be owned bv 
and in the legal possession of said party. 



Statutory Authority G.S. 106-638. 

.0240 FORM BS-11 

Form BS-11 is an application form for an indi- 
vidual, corporation, or firm wishing to sell bees 
or beehives in North Carolina. The application 
form requires the following: 

(1) Name, address, and location of applicant; 

(2) Information pertinent to the type and 
number of bees to be sold in North Carolina 
during the permitting period: 

(3) The application must be accompanied bv 
a non-refundable fee of twenty-five dollars 
($25.00): 



(4) The permit will expire on December 31 of 
each year and must be renewed each year 
by filling out a new application form. 
After satisfactorily complying with the informa- 
tion on the application, the Commissioner will 
issue a permit, Form BS-12. 

Statutory Authority G.S. 106-638. 

.0241 FORM BS-12 

Form BS-12 is a permit for an individual, cor- 
poration, or firm wishing to sell bees or beehives 
in North Carolina. Form BS-1 1 must first be 
approved before the issuance of this permit. The 
permit lists the following: 

(1) Name, address, and location of approved 
applicant; 

(2) The permit will expire on December 31_ of 
each year and must be renewed each year 
by filling out a new application form, BS-1 1. 

Statutory Authority G.S. 106-638. 

SECTION .0600 - BOLL WEEVIL 

.0601 DEFINITIONS 

For the purposes of this Section, in addition to 
definitions contained in G.S. 106-65.69, the fol- 
lowing shall apply: 

(1) Compliance Agreement. A written agree- 
ment between a person engaged in growing, 
dealing in or moving regulated articles and 
the North Carolina Department of Agricul- 
ture, Plant Industry Division, wherein the 
former agrees to comply with conditions 
specified in the agreement to prevent the 
dissemination of the boll weevil; 

(2) Exemptions. Provisions contained in these 
Regulations which provide for modifications 
in conditions of movement of regulated ar- 
ticles from regulated areas under specified 
conditions; 

(3) Elimination Zone. That portion of this 
state where eradication of the boll weevil is 
undertaken as an objective; 

(4) Inspector. Any authorized employee of 
the North Carolina Department of Agricul- 
ture, Plant Industry Division, or any other 
person authorized by the Commissioner of 
Agriculture to enforce the provisions of this 
Section; 

(5) Regulated Area. Any state other than 
North Carolina or any portion of such state 
that is infested with the boll weevil; 

(6) Noninfested Area. That portion of this 
state not included in an elimination zone; 

(7) Seed Cotton. Cotton as it comes from the 
field prior to ginning; 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1643 



PROPOSED RULES 



(8) Gin Trash. All of the material produced 
during the cleaning and ginning of seed cot- 
ton, Sollies or snapped cotton except the 
lint, cottonseed and gin waste; 

(9) Noncommercial Cotton. Cotton intended 
for purposes other than processing; 

(lOj ASCS. United States Department of Ag- 
riculture, Agricultural Stabilization and 
Conservation Service; 

(11) Farm Operator. Person responsible for 
production and sale of a cotton crop on any 
individual farm; 

(12) Used Cotton Harvesting Equipment. 
Previously utilized cotton equipment used 
to harvest, strip, transport, or destroy cot- 
ton; 

(44) Waiver. A written authorization which 

©«e &f more specific requir e ments; 
(444 (13) Cotton Crop Residue Destruction. 
Mowing of cotton plant stalks left in field 
after harvesting of crop is completed. 

Statutory Authority G.S. 106-65.77; 106-65.91. 

.0608 REPORTING OF ACREAGE: 

LOCATION OF COTTON ACREAGE 

All cotton farm operators and growers of non- 
commercial cotton in an elimination zone shall 
submit a Cotton Acreage Reporting Form by 
July 1 of the current growing season to the 
county ASCS office. A report shall be filed for 
each year of participation in the program. 

( 1) Noncommercial cotton shall not be planted 
in an elimination zone except under the 
conditions of a compliance agreement. 
Growers of noncommercial cotton in an 
elimination zone may apply for a waiver to 
grow cotton in an elimination zone. Appli- 
cations, in writing, shall be made to the 
Plant Pest Administrator stating the condi- 
tions for requesting such waiver. The deci- 
sion whether or not to waive all or part of 
these requirements shall be based on the 
following: 

(a) location of growing area; 

(b) size of growing area; 

(c) pest conditions in the growing area; 

(d) accessibility of growing area; 

(e) any stipulations set forth in a compliance 
agreement between the individual and the 
Department of Agriculture that are neces- 
sary for the effectuation of the program. 

(2) Written application for waivers shall be 
made to the Plant Pest Administrator for 
review. 

Statutory Authority G.S. 106-65.77; 106-65.91. 



.0611 PROGRAM PARTICIPATION AND 
PAYMENT OF FEES 

(a) All cotton farm operators in the state are 
hereby required to participate in the eradication 
program. Participation shall include timely re- 
porting of acreage and field locations, compliance 
with regulations, and payment of fees. Farm 
operators within the elimination zone shall be 
notified through the extension offices or newspa- 
pers of their program costs on a per acre basis 
on or before March 15. T4*e following prooo 
dureo are r e quir e d fof participation t» the p*e- 
gram: 

( 1) Filling etrt Growers are to report all planted 
cotton by completing a Cotton Acreage Re- 
porting Form and paying a per acre fee at 
the ASCS office by July 1 of the current 
growing season, fof which participation is 
desired. At- this tim e the farm operator shall 
pay a nonrefundable fee » a» amount suffi 
ciont te- cover estimated program costs as 
determined by the Commissioner, b«t net 
te> exceed nine dollars ($9.00) pet acre. 
Those farm op e rators net reporting their 
acreage by J-ttly 4- vviU Ret he considered as 
program participants. All acreage reported 
by such nonparticipants after J-ttlv 4- wiH he 
considered m exc e ss a«4 subject te penalty. 

(2) AH fees shall he paid by the farm operator. 
Foes shall he made payable te NCDA an4 
collected by ASCS. The fee is 
nonrefundable and is to pay for the pro- 
gram's estimated costs as determined bv the 
Commissioner, but will not exceed nine 
dollars (S9.00) per acre. 

(3) Growers not reporting planted cotton to 
ASCS by July 1 of the current growing sea- 
son will be assessed a three dollar (S3. 00) per 
acre penalty. 

(4) Growers under-reporting by more than ten 
percent of the actual planted acreage, as de- 
termined by ASCS, will be assessed a pen- 
alty of three dollars (S3. 00) per acre on all 
acreage in excess of the reported acreage. 

(5) All acreage for which fees have not been 
paid on or before July j_5 of the current 
growing season will be assessed a three dol- 
lar (S3. 00) per acre penalty. 

(6) Interest at j_5 percent per annum will be 
charged on all unpaid fees and penalties 
from August j_ to date of payment. 

(7) fees and penalties shall be made payable 
to the North Carolina Department of .Agri- 
culture. 

(8) Fxtenuating circumstances, as determined 
bv the Commissioner, may warrant the par- 



tial or total refund of penalties. A request 



1644 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



for the refund of penalties, including a com- 
plete explanation of extenuating circum- 
stances, must be provided in writing to the 
Plant Pest Administrator within 30 days of 
such payment. 
(b^ Farm oporators m tbe elimination zone 
whos e ASCS moaourod acroago oxooodo the 
grower roportod acroago by- more than te» pef- 
cont, shall be aooooood a penalty fee ef throo 4ef- 
lats (S3. 00) pef aefe e» that- acroago » oxcogd ef 
tke roportod acreage. 

(e) A farm oporator may apply fef a waivor 
requesting dolayod payment under conditions ef 
financial hardship. A«y farm oporator applying 
fef a waiver shall mako application i» writing te 
the Plant Post Administrator. This request must 
be accompanied by a financial statomont from a 
bank ef lending agoncy supporting such roquoGt. 
AH- farm operators granted waivor requests fef fi- 
nancial hardship wiH be charged interest payablo 
at a Fate equal te 44 poroont peF annum. ¥be 
docision whether ef set te waivs all ef part ef 
those roquiromonts shall be mad e by the Plant 
Pest- Adrninistrator aee notification given te the 
farm oporator within twe weeks after rocoipt ef 
such application. 
(a) Failure te- pay- aU fees ef file a complotod 
waivor roquost fef dolayod paymont e» ef before 
fely- 44 ef the curront growing s e ason will result 
m a ponalty fee ef five dollars (S5.00) pef acre. 

I T ^ ■H | r-n 1 ;ar | .-• Ilfl «-1 t jt,-l nil jt-h .-y»-> <■ f h'lll I~« ■■■» fll II ■» t 4 1-. .1 
IT CT TTTITTCT ITT C4 U 1 1 1 VUy r > Ivl rT U11LUT UU UUU U L L 1 l\J 

time the cotton is sold, ef by Novomber 447 
whichever is sooner. 

Statutory Authority G.S. 106-65.74; 106-65.77; 
106-65.88; 106-65.91. 

CHAPTER 52 - VETERINARY DIVISION 

SUBCHAPTER 52B - ANIMAL DISEASE 

SECTION .0200 - ADMISSION OF LIVESTOCK 
TO NORTH CAROLINA 

.0204 IMPORTATION REQUIREMENTS: 
BRUCELLOSIS 

(a) All cattle imported into North Carolina, 
regardless of the class of state, are subject to the 
provisions of this Rule, as follows: 

(1) all cattle shall be identified by ear tag, 
tattoo, or other permanent means ap- 
proved by the State Veterinarian; 

(2) cattle originating from any certified 
Brucellosis-free State or herd may enter 
North Carolina provided the following is 
recorded on the official health certificate: 

(A) individual identification of each animal, 

(B) herd certification number, and 

(C) date of last herd test; 



(3) no test is required on steers and spayed 
females; 

(4) no cattle will be accepted (other than those 
consigned to immediate slaughter) which 
have been adult vaccinated against 
brucellosis or originate from infected, ex- 
posed or quarantined herds; 

(5) required retests will be performed by rep- 
resentatives of State Veterinarian at no 
expense to the owner, or the owner may 
have the tests conducted by an accredited 
veterinarian at his expense; and 

(6) all cattle shall be negative in all dilutions 
if tube or plate agglutination test is used, 
or negative to official card test. 

(b) In addition to the requirements of (a) of 
this Rule, cattle imported from brucellosis-free 
and class-A states shall comply with the follow- 
ing: 

(1) all females and bulls eight months of age 
and older shall be tested negative within 
thirty days prior to entry into North 
Carolina, except: 

(A) dairy heifers under twenty months of 
age, and heifers of the beef breeds under 
twenty-four months of age that are offi- 
cially vaccinated against brucellosis; and 

(B) cattle originating from any certified, 
brucellosis-free herd, provided the follow- 
ing is recorded on the official health cer- 
tificate: 

(i) individual identification of each ani- 
mal; 
(ii) herd certification number; 
(iii) date of last herd test; and 

(2) cattle from Fr ee stat e s af>4 class A states 
which originate from the farm of origin 
and move directly to an approved 
stockyard or farm in North Carolina in 
compliance with this part are not required 
to be tested within 45 to 120 days after 
entry. However, the State Veterinarian 
strongly recommends a retest and retests 
may be performed by a representative of 
the State Veterinarian at no expense to the 
owner. Eligible cattle which have been 
commingled in a stockyard prior to 
importation must in addition to the re- 
quirements of this part pass a negative re- 
test within 45 to 120 days after arrival in 
this state. 

(c) In addition to the requirements of (a) of this 
Rule, cattle imported from class B states shall 
comply with the following: 

(1) a permit issued to a North Carolina resi- 
dent by the State Veterinarian of North 
Carolina prior to entry is required; 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1645 



PROPOSED RULES 



(2) all females and bulls eight months of age 
or older must be tested negative within 30 
days prior to entry into North Carolina 
except: 

(A) dairy heifers under twenty months of 
age and heifers of the beef breeds under 
twenty-four months of age officially 
vaccinated against brucellosis; 

(B) cattle originating from any certified 
brucellosis-free herd provided that the 
following is recorded on the official health 
certificate: 

(i) individual identification of each ani- 
mal: 
(ii) herd certification number; and 
(iii) date of last herd test; 

(3) all test eligible cattle shall be quarantined 
upon arrival and must pass a negative re- 
test within 45 to 120 days after arrival. 

(d) In addition to the requirements of (a) of 
this Rule, cattle imported from a class C state 
shall comply with the following: 

(1) a permit issued to the North Carolina 
resident by the State Veterinarian in 
North Carolina prior to entry is required; 

(2) all females and bulls eight months of age 
and older must have two negative tests at 
least 60 days apart, with the second test 
being conducted within 30 days of entry 
into North Carolina, except: 

(A) dairy heifers under twenty months of 
age officially vaccinated against 
brucellosis; 

(B) heifers of the beef breeds less than 
twenty-four months of age and officially 
vaccinated against brucellosis; 

(C) cattle originating from any certified 
brucellosis-free herd provided the follow- 
ing is recorded on the official health cer- 
tificate: 

(i) individual identification of each ani- 
mal; 
(ii) herd certification number; and 
(iii) date of last herd test; 

(D) test eligible cattle may enter North 
Carolina on a 30 day negative test pro- 
vided that the herd of origin has had a 
complete negative test within the previous 
12 months; 

(E) test eligible cattle may enter North 
Carolina with one negative test for 
consignment to a specifically state, feder- 
ally approved stockyard. A permit from 
the State Veterinarian or his authorized 
representative is required prior to removal 
of cattle from the stockyard under this 
provision; and 



(3) all test eligible cattle shall be quarantined 
upon arrival and shall pass a negative re- 
test within 45 to 120 days after arrival and 
all female cattle which are from a "C" 
state shall remain under quarantine until 
tested negative 20 to 45 days post calving 
or until slaughtered. 

(4) feeder heifers must also be spayed and 
"spayed branded" or be "F" branded. 
Feeder heifers are subject to item (3) of 
this Paragraph. Branding must be with a 
hot brand, the letter F on the right or left 
tail head area. This F brand size should 
be 3" x 3". A properly applied and placed 
F brand will meet the individual identifi- 
cation requirement as specified in (a)(1) 
of this Rule. 



Statutory Authority G.S. 
106-3%. 



106-22; 106-307.5; 



.0207 IMPORTATION REQUIREMENTS: 
SWINE 

(a) All swine imported into the state, except 
by special permit or for immediate slaughter, 
shall be accompanied by an official health certif- 
icate issued by a state, federal, or accredited 
veterinarian stating that they are free from any 
signs of an infectious or communicable disease 
and are not known to have been exposed to 
same. The health certificate shall contain the ear 
tag number of each animal or other identification 
acceptable to the State Veterinarian. Swine im- 
ported for feeding or breeding purposes shall be 
moved in clean and disinfected trucks or other 
conveyances. 

(b) Breeding swine shall originate from a 
"Validated Brucellosis-Free" herd or a "Vali- 
dated Brucellosis-Free" State and originate from 
a "Qualified Pseudorabies-Negative" herd or 
Pseudorabies Stage V (Free) State as defined in 
Title 9, Parts 78.1 and 85 of the Code of Federal 
Regulations. A permit issued bv tbe Stat e 
Veterinarian ef North Carolina is- required fo* aH 
brooding swin e entering tb& state. T4*e pormit 
number must W shown ©» tbt» interstate health 
certificate accompanying e ach shipment. 

(c) All feeder swme imported into the state 
shall be accompanied by an official health certif- 
icate issued by a state, federal or accredited 
veterinarian stating that: 

( 1 ) No pseudorabies vaccine has been used in 
the herd of origin, unless the herd is a 
pseudorabies Controlled Vaccinated herd 
as defined in Title 9, Part 85.1 of the Code 
of Federal Regulations, or a pseudorabies 
monitored vaccinated herd: and 



1646 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



(2) The swine were tested and found negative 
for pseudorabies within 30 days prior to 
importation; or 

(3) The swine originated from a 
pseudorabies-free area as determined by 
the State Veterinarian; or 

(4) The swine originated from a Qualified 
Pseudorabies Negative Herd as defined in 
Title 9, Part 85 of the Code of Federal 
Regulations; or 

(5) The swine originated from a monitored 
feeder pig herd. For the purposes of this 
Rule, in order to qualify as a monitored 
feeder pig herd, testing must have been 
performed in accordance with the follow- 
ing standards: 

(A) In herds often or fewer breeding swine, 
all breeding swine must test negative 
within 12 months prior to importation. 

(B) In herds of 1 1 to 35 breeding swine, ten 
randomly selected breeding animals, (to 
include gilts, sows and boars) must test 
negative within 12 months prior to 
importation. 

(C) In herds of more than 35 breeding 
swine, either 30 or 30 percent of the total 
herd, whichever is less, randomly selected 
breeding gilts, sows and boars must test 
negative within 12 months prior to 
importation. 

(D) All breeding gilts, sows and boars in a 
herd shall be subject to random selection 
for testing. 

(E) Testing must be done by use of an of- 
ficial pseudorabies test, as defmed in Title 
9, Part 85 of the Code of Federal Regu- 
lations. 

(d) Healthy swine for feeding purposes may 
move directly from a farm of origin in a contig- 
uous state on which they have been located for 
not less than 30 days to a livestock market or 
stockyard in North Carolina that has been state- 
federal approved for handling feeder swine, with- 
out the health certificate required herein, 
provided such swine are accompanied by proof 
of the pseudorabies status of the herd of origin 
acceptable to the State Veterinarian. Such swine 
shall be inspected by a state or federal inspector 
or approved accredited veterinarian prior to sale 
at the market. 

(e) Healthy swine may be shipped into the state 
for immediate slaughter without a health certif- 
icate provided they go directly to a slaughtering 
establishment approved by the State 
Veterinarian, or to a state-federal approved live- 
stock market or stockyard for sale to an approved 
slaughtering establishment for immediate slaugh- 
ter only. 



(f) As used in Paragraph (c)(1) horoof, of this 
Rule, a "monitored vaccinated herd" means a 
herd in which all breeding swine over six months 
of age have been officially vaccinated by an ac- 
credited veterinarian with a vaccine the titers of 
which can be distinguished from pseudorabies 
field infections and the herd has passed an official 
random sample test or complete herd test during 
the preceding 12 months. (From proposed 
Pseudorabies Eradication Uniform Methods and 
Rules of the United States Department of Agri- 
culture.) 

Note: Violation of this Rule is a 
misdemeanor under G.S. 106-307.6, which 
provides for a five hundred dollar ($500.00) 
fine, six months' imprisonment, or both. 

Statutory Authority G.S. 106-307.5; 106-316.1; 
106-317; 106-318. 

.0209 IMPORTATION REQUIREMENTS: 
SHEEP 

(a) The health certificate covering the 
importation of sheep shall include a report of in- 
spection by a veterinarian approved by the chief 
livestock sanitary official of the state of origin 
indicating the sheep are not under quarantine and 
are free from signs of any infectious or 
communicable disease. The health certificate 
shall contain a statement that the flock of origin 
has not had scrapie diagnosed within the past 42 
months. 

(b) Sheep which have not been handled in 
stockyards, stock pens or on premises in public 
use for livestock may be imported without dip- 
ping, from a state or area designated as scabies- 
free by the United States Department of 
Agriculture. 

(c) Unless waived by the State Veterinarian, 
sheep for purposes other than immediate slaugh- 
ter that have not been dipped in accordance with 
the regulations of the Animal and Plant Health 
Inspection Service, Veterinary Services, United 
States Department of Agriculture may not be 
imported into the state. While in transit they 
shall be accompanied by a certificate of such 
dipping. The requirements for dipping will be 
waived when it can be determined that the sheep 
will be isolated from other animals at the North 
Carolina destination until dipped. 

(d) Sheep consigned for the purpose of imme- 
diate slaughter to a recognized stockyard, or to a 
slaughtering establishment with state or federal 
inspection may be imported without a health 
certificate. A waybill or certificate marked for 
immediate slaughter must accompany such ship- 
ments. 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1647 



PROPOSED RULES 



Statutory Authority G.S. 106-307.5. 

.0210 IMPORTATION REQUIREMENTS: 
AVIAN SPECIES 

Members of the avian species, other than 
chickens, turkeys, or other domestic poultry, en- 
tering into North Carolina shall be accompanied 
by a permit from the Stat e Votorinarian ef North 
Carolina &f h» authorized representativ e as4 be 
accompanied by an official interstate health cer- 
tificate issued within five days of shipment. 

Note: For chickens, turkeys or other domestic 
poultry, see 2 NCAC 52B .0600. 



(d) fe) Other wild and semi-wild animals, (ex- 
cept the American buffalo ef bison which fef the 
purpooo ef th» Section shall be considered as 
beef cattle), under domestication or in custody 
may be imported into this state, provided that a 
report of the number of animals by species is 
made to the State Veterinarian within 96 hours 
after entry into the state, and that an immediate 
opportunity for examination to determine the 
health status of such animals is afforded the State 
Veterinarian or his authorized representative. 

Statutory Authority G.S. 106-317; 106-400. 



Statutory Authority G.S. 106-539; 106-540; 
106-543. 

.0212 IMPORTATION REQUIREMENTS: 
WILD ANIMALS 

(a) A person shall obtain a permit from the 
State Veterinarian before importing any of the 
following animals into this State: 

(1) Skunk; 

(2) Fox; 
Raccoon; 
Ringtail; 
Bobcat; 
Coyote; 
Marten. 

Permits for the importation into this State 
of any of the animals listed in (a) of this Rule 
shall be issued only if the animal(s) will be used 
in a research institute, or for public display or 
organized entertainment as in zoos or circuses. 

(c) Llamas, all cervidae, bison and all other 
bovidae other than domestic cattle mav be im 



(3) 
(4) 
(5) 
(6) 
(7) 
(b) 



ported into the State if accompanied by an offi- 
cial health certificate issued by an accredited 
vetennanan which states that: 



( 1 ) all animals six months of age or older have 
tested negative for brucellosis within 30 
days prior to importation; and 

(2) all animals six months of age or older have 
tested negative for tuberculosis within 60 
days prior to importation pursuant to the 
guidelines of the United States Depart- 
ment of Agriculture Veterinary Services 

990, which 



Notice dated December 31, 



intradermic injection of 0_1_ ml of U. S. 
Department of Agriculture (L SPA) con- 
tract PPD Bovis tuberculin in the 
midcenical region with readme by obser- 
vation and palpation at 72 hours, plus or 
minus 6 hours": and 
(3) the herd of origin has had no brucellosis 
or tuberculosis diagnosed within the past 
12 months. 



SUBCHAPTER 52E - MARKETING OF 
LIVESTOCK 

SECTION .0100 - DEFINITIONS AND GENERAL 
RULES 

.0103 RESOLD CATTLE 

(a) When cattle for feeding or breeding pur- 
poses are delivered to a public livestock market, 
the seller shall designate as "resold" or "second- 
handed" any cattle which have been sold through 
any livestock market within the previous 21 days. 
The seller shall make this designation to the 
livestock market operator, his agent, or the North 
Carolina Department of Agriculture livestock in- 
spector in charge. 

(b) All resold or second-handed cattle shall be 
penned together and separate from farm fresh 
cattle. The market operator shall announce to 
the buyers that these are resold or second-handed 
cattle when they are offered for sale. 

Note: Violation of this Rule 



— ^ misdemeanor under G.S. 106-417, 



is a 

and vi- 
olators may be fined or imprisoned, or both, 
in the discretion of the court. In addition, 



a public livestock market license mav be re- 
voked for violations of this Rule, pursuant 
to G.S. 106-407.2. 

Statutory Authority G.S. 106-416. 

TITLE 4 - DEPARTMENT OF ECONOMIC 
AND COMMUNITY DEVELOPMENT 



states "the cervical test for cervidae is the f\ ( 



otice is hereby given in accordance with G.S. 
I50B-2I.2 that the North Carolina Alcoholic 
Beverage Control Commission intends to amend 
rulefsj cited as 4 XCAC 2R .0204 - .0205, .0404 

- .0405, .0701 - .0702, .0802, .0820, .0901 - .0902, 
.0906, .1008, .1203, .1205, .1401 - .1402, .1407, 
.1701, .1703, .1708, .1801, .1901, .1903; 2S .0101 

- .0103, .0105 - .0108, .0202, .0205, .0218, .0220, 
.0227, .0229, .0232, .0402 - .0403, .0502 - .0503, 
.0510, .0512 - .0514, .0516. .0518 - .0520, .0703 - 



1648 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



.0707, .080 1, .0902 - .0903, .100 1, .1004 - .1012, 
.1014, .1020, .1101, .1103; 2T .0101, .0201 - 
.0203, .0401, .0409, .0501 - .0502, .0602, .0604, 
.0607, .0702, .0704, .0707 - .0709, .0901; repeal 
rule(s) cited as 4 NCAC 2R .0301 - .0302, .0801, 
.0805 - .0808, .0810 - .0812, .0814 - .0819, .1704, 
.1707; 2S .0221, .0406, .0515, .0601, .0603, .0605 
- .0611, .0802 - .0804; 2T .0605, .0608, .0710; and 
adopt rule(s) cited as 4 NCAC 2R .0303 - .0304, 
.0821 - .0823, .0909, .1009, .1503, .1710, .1803 - 
.1805; 2S .0233 - .0236, .0407, .0523 - .0529, 
.0612, .0708; 2T .0206, .0610, .0711 - .0717. 

1 he proposed effective date of this action is July 
1, 1992. 

1 he public hearing will be conducted at 10:00 
a.m. on April 9, 1992 at the ABC Commission 
Offices, Hearing Room, 3322 Garner Road, 
Raleigh, NC 27610. 

IXeason for Proposed Action: This is a general 
rewrite of existing rules. Repeals are to delete 
rules that are not necessary or that repeat statutes. 
Amendments and adoptions are to codify what are 
accepted trade practices by alcoholic beverage 
retailers and industry; to codify Commission in- 
terpretations of current rules and statutes; to 
clarify existing rules; to implement 1991 
enactments by the General Assembly; and to make 
grammatical, technical and conforming changes. 



Cc 



-omment Procedures: Written comments con- 
cerning proposed repeals, adoptions or amend- 
ments should be submitted no later than April 9, 
1992 to Ann Fulton, Commission Counsel, P.O. 
Box 26687, Raleigh, NC 27611-6687. Oral com- 
ments may be presented at the hearing. 

CHAPTER 2 - ALCOHOLIC BEVERAGE 
CONTROL COMMISSION 

SUBCHAPTER 2R - ORGANIZATIONAL RULES: 
POLICIES AND PROCEDURES 

SECTION .0200 - STRUCTURE 

.0204 ADMINISTRATIVE FUNCTIONS 

The principal administrative officer shall be the 
administrator who executes rules, policies and 
procedures governing the sale of alcoholic 
beverages and coordinates the functions of the 
Commission with local boards and industry. 

Statutory Authority G.S. 18B-200(d); 18B-203; 
18B-207. 

.0205 LEGAL FUNCTIONS 



(a) ¥he hearings division providoo adminiotra 
five hoarings fof poroons ohargod with violations 

<-»♦ \ P 1 lmiii' «i «-i f\ Ti-\f n «-v r.lif'inti' ^ \ r r\ j~i riiriimi^ ej wb 

OT T»^y^^ it^^t^ niTTT iui lil.fi 'iimiiu tttttt i on uuji u ul'i i 

ft hearing after disapproval ef a» application a«4 
holds other hoarings as directed by the chairman 
ef the Commission. Hoarings are conducted by 
ft hearing officer d e signated by- the chairman ee 
the Commission. ¥4*e hoarings division main 
tains ease records a&4 files that ate available fee 
inspection by the partios, issuoo subpoonas, eef- 
leets money payable te the Commission from 
finos aft4 offers » compromise »«4 r e mits this 
money te the State Tr e asurer &>f the g e neral 
fund, ana distributes a calendar ef cases hoard 
a«4 disposed ef by the Commission. R e cords, 
files a»4 calendars ef cases may be inspected at 
©f obtained from the Commission offices, 3322 
Gamor Road, Pest Offic e 6e* 26687, Raleigh, 
Nertb Carolina 2761 1 6687. 

(b) Hearing Officer, ^^he hearing officer con 
ducts administrative hoarings relative te- alleged 
violations an4 appeals by applicants who have 
boon deni e d permits ana rocommonds a disposi 
tie» ef each case. Final decisions m hoaring 
oases ape mad e by the Commission. 

The Legal Division processes cases involving 
permittees charged with violations of the ABC 
laws, and represents the Commission in con- 



tested cases before the Office of Administrative 
Hearings. Legal staff may also serve as hearing 

otficers in cases filed under Article 12 of Chapter 
18B. 

Statutory Authority G.S. 18B-104; 18B-200(d). 

SECTION .0300 - PUBLICATIONS: RECORDS: 
COPIES 

.0301 DISTRIBUTION OF RULES 

(a)- Distribution te- Permittees, fi* addition te 
publications requir e d by law-r copies ef policies, 
rules, et amendments that aff e ct porsons e ngaged 
m the alcoholic bovorage industry shall be sfis- 
tributod te the clerks ef court i» e ach ef the +QQ 
counties a»4 te employees ef the Commission 
charged with the responsibility ef administering 

fU„ A D(" 1 „ ■ . , 

Copies ef aey policies, rul e s ?m4 amendments 
shall be availabl e te a«y interested party by 
sending the appropriate fees ter 
NC. Alcoholic Beverage Control Commission 
3322 Garner Road 
R.O, Be* 3668-7- 
Raloigh, North Carolina 27611 6687 
¥b& following items ape available: 

(44 Chapter 4-8R- ef the North Carolina Gen 
erai Statutes; 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1649 



PROPOSED RULES 



{¥} Title 4t Chapter 2 ef tbe North Carolina 
Administrative Code (North Carolina Af- 
coholic Bevorago Control Commission); 
fj) Amondmonto te rules proviouoly adopted 
by- the Commis ' .iion. 
fb) Distribution te Fmployoos. A copy ei aU 
policioo aed rules pertaining te fee duties ae4 
conduct el employees ef fee Commission shall 
be distributed te those employees. 

fe) Distribution te local Boards. A copy ef 
aU policies aftd rules affecting local boards shall 
be distributed te the chairman a«4 supervisor ef 
each local board. 
f4} Distribution te Alcohol Law Enforcement 
Division. A copy ef aU policies ae4 rules pw- 
taining te duties engaged » by- the A LE Division 
shall be distributed te each omployoo ef fee divi 

Statutory Authority G.S. 1 2-3. 1(c); 18B-207; 
150B-62. 

.0302 PUBLIC INSPECTION OF RULES 
AND RECORDS 

fa} All rules ami other written statements ef 
policy e* interpretations formulated, adopted e? 
used by- fee Commission m the discharge ef its 
functions shall be available fef public inspection 
at- fee Commission's office m Raleigh, North 
Carolina, between &W a.m. ae4 #4)4> p.m., 
Monday through Friday. The Commission will 
ake make available fef public inspection all ae- 
plications fef ABC permits; testimony rocoivod 
i»te evidence at rule malring hearings a«4 
hearings ef contested cas e s; ae4 aey- testimony 
ef evidence upon which is based a final decision 
determining the legal rights, duties ef privileges 
ef specific parties, ef determining privat e rights 
ef procedures available te the public. 

fb} The following shall eet be open te public 
inspection: 

offic e r net based ee comp e t e nt e vid e nc e 

obtained by the officer; 
f3} identity ef confidential sources, informers 

ef und e rcover officers; 
fj} all files, reports ef evidence m connection 

with ae ongoing investigation. 



officer employed by a contracting agency pursu- 
ant to G.S. 18B-50 1 (F), and to each employee of 
the Commission. 

(b) Purchasing Copies of the ABC Laws. 
Copies of the ABC laws are available to any in- 
terested person who contacts the Commission at 
the following address or phone number: 

North Carolina Alcoholic Beverage Control 

Commission 

3322 Garner Road 

P.O. Box 26687 

Raleigh, NC 27611-6687 

(919) 779-0700 

The following items are available and should be 

purchased together for complete access to the 

ABC laws of this State: 

( 1) Chapter 18B of the North Carolina Gen- 
eral Statutes, a\_ a cost of five dollars 
($5.00). 

(2) Title 4j Chapter 2 of the North Carolina 
Administrative Code, containing all the 
rules of the Commission, at a cost of 
seven dollars and fift\ 



at a cost 

cents ( $7.50). 



Payment by check or cash must be made prior 
to receiving copies of either publication. 

(c) Copies of Individual Rules or Statutes. For 
a fee of twenty-five cents ($0.25) per page, copies 
of rules, amendments and general statutes are 
available to any person contacting the Commis- 
sion at the address and phone number in Para- 
graph (b) of this Rule. 

(d) Public Inspection of Records. Inspection 
of records and documents in the possession and 
custody of the Commission is governed by the 
provisions of Chapter 132 of the North Carolina 
General Statutes. Fees for copying public re- 
cords shall be twenty-five cents ($0.25) per page. 



Statutory Authority G.S. 12-3.1: 
through 132-1.3; 132-6. 



18B-207; 132-1 



.0304 FEE FOR PERMITTEE LISTS; 
COMPUTER SERVICES 

(a) Lists. For a fee of seven cents ($0.07) per 
name, the Commission will provide to any in- 
terested person a list of permittees by county or 
by types of permits issued. Orders for a 
permittee list should be placed at least 72 hours 
in advance. The purchaser of the list will be 
notified of the total cost, including postage, and 
will be required to remit the total cost plus post- 



Statutory Authority G.S. 18B-207; 150B-11. 

.0303 DISTRIBUTION, INSPECTION AND 
COPIES OF ABC LAWS 

(a) Distribution of Rules and Statutes. A copy 
of the Commissions Rules and Chapter 1SB of 
the General Statutes will be distributed at no 
charge to each local ABC board, each ALE 
agent, ABC officer and local law enforcement services will be determined based on the actual 



age, bv check or money order, before receiving a 
copy of the list. 

(b) Other Data Processing Services. The 
Commission will attempt to provide data proc- 
essing services related to the Commission's pow- 
ers and duties upon request. Fees for such 



1650 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



cost to the Commission and shall be required to 
be paid in advance. 

Statutory Authority G.S. I8B-207; I50B-I9(5)e. 

SECTION .0400 - RULE-MAKING 

.0404 NOTICE OF RULE-MAKING 
HEARINGS; MAILING LIST 

(a) Upon a determination to hold a rule- 
making proceeding, either in response to a peti- 
tion or otherwise, the Commission shall give at 
least 3© dayo notice to all interested parties of a 
public hoaring »» the proposed rulo. the pro- 
ceedings in accordance with the requirements of 
Chapter 150B of the General Statutes. 

(b) Mailing List. Any person desiring to be 
placed on the mailing list for the rule-making 
notices may file a request in writing, furnishing 
his name and mailing address to the Commis- 
sion. The request shall state the subject areas 
within the authority of the Commission for 
which notice is requested. 

LflJ DliKlii'-lfinn /-\i \. ntii-.l Pi 1 hli f n i-t ♦«,-..-> nf *h/\ 

rulo malcing proooodingo wiH be by publication 
» ¥4*e North Carolina Rogiotor. 

(c) Fee Charged. The cost to be on the mailing 
list for rule-making notices shall be fifteen dollars 
($15.00) per year. A notice and invoice will be 
mailed in February of each year to persons on 
the mailing list. Persons who do not renew their 
request to remain on the mailing list bv remitting 
the fee by March J_ of each year will be deleted 
from the list. 

Statutory Authority G.S. J SB- 207; 150B-21.2. 

.0405 RULE -MAKING HEARING 

(a) Location. Unless otherwise stated in a 
particular rule-making notice, rule-making 
hearings shall be held in the administrative hear- 
ing room of the Commission's Raleigh office. 

(b) Oral Presentations. Any person desiring to 
present oral data, views or arguments on the 
proposed rule shall, at- least- thr e o days prior te 
the hoaring, is encouraged to file a written notice 
of that desire with the chi e f hearing officor. 
Chairman. Notice ©f th*s presentation H*ay be 
waiv e d »f a failure te give the notic e may be es- 
cuood by the chairman upon a showing ef good 
cause. The notice of the oral presentation shall 
should contain a brief summary of the individ- 
ual's or organization's views with respect to the 
proposed adoption, amendment or repeal of a 
rule, and a statement of the length of time the 
speaker intends to speak. 

(e} Written submissions. Writton materials 
containing data, comments »f arguments con 



coming proposed rules that afe filed within the 
time allowed shall be considered by the Com 
mission before the final adoption, amendment 

ui npen *_m cr iuiu, 

(c) (44 The Chairman shall preside at the rule- 
making hearing, and shall insure ensure that each 
person participating is given a fair opportunity to 
present oral arguments, comments and data sup- 
porting his position. 

Statutory Authority G.S. 18B-207; I50B-21 .2(e). 

SECTION .0700 - PERSONNEL POLICIES: 
COMMISSION 

.0701 STANDARDS FOR COMMISSION AND 
EMPLOYEES 

(a) Financial Interests Prohibited. No member 
or employee of the Commission shall have or 
acquire any financial interest in the business, 
equipment or premises operated by any person, 
firm or corporation engaged in the production, 
sale or distribution of alcoholic beverages. 

(b) Relations. No member or employee of the 
Commission shall be related by blood, to the 
degree of first cousin or closer, to any person 
engaged or employed in the production, sale or 
distribution of alcoholic beverages in this State. 

(c) Gifts. No member e? employee or Com- 
mission member ©f the Commission shall require 
gifts &f alcoholic bovoragos accept any gift or a»y 
other thing of value from any person, firm or 
corporation engaged in the production, sale or 
distribution of alcoholic beverages that would 
result in a violation of any general statute or 
Executive Order. 



(d) Entertainment. Except as prohibited else- 
where in these Rules reasonable entertainment 
of members or employees by a permittee or his 
representative is proper when that member or 
employee is entertained in an official capacity as 
a representative of the Commission, such as rea- 
sonable entertainment at state or national con- 
ventions or similar events, or for good and proper 
reason that will not tend to influence the member 
or employee in the discharge of his duties with 
the Commission. 

Statutory Authority G.S. 1SB-20I; 18B-207. 

.0702 DISCIPLINARY ACTION OF EMPLOYEE 

All employees of the Commission shall be sub- 
ject to the policies set- forth » the Personnel 
Manual ©f- the North Carolina State Personnel 
established by the Office of State Personnel per- 
taining to disciplinary action, suspension and 
dismissal. 

In addition to the grounds for disciplinary 
action provided m the State Personnel Manual 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1 65 1 



PROPOSED RULES 



ef toe North Carolina Stat e Poroonnel Office, by 
the Office of State Personnel, the following shall 
be additional grounds for disciplinary action: 

(1) willful disregard of the published policies 
of the North Carolina Alcoholic Beverage 
Control Commission, or 

(2) violation of any law pertaining to alcoholic 
beverages. 



Statutory Authority G.S. 
18B-207. 



18B-201; I8B-202; 



SECTION .0800 - ADJUDICATION: 
CONTESTED CASES 

.0801 DEFINITIONS 

A* usod » tfe» Soction: 

application fof a pormit has boon rojoctod, 
ef a»y porson whe currontly holds a pormit 
toa* is subject to suspension, revocation ef 
a mo notary ponalty. 

$0$ "Party" moans eaeh porson ef agoncy 
named ef admittod as a party ef proporly 
soolcing as ef right to be admittod as a party, 
a»4 includoo the Commission whore appro 
priato. 

(44 "Hearing" means toe initial administrative 
proceedings conducted by- a hearing officer. 

£4} "Final hearing" moans the proceedings be- 
tore toe Commission reviewing toe rooom 
mondation ef a hoaring officer as to toe 
disposition ef a oontootod case. 

Statutory Authority G.S. 18B-207; 150B-11; 
150B-23. 

.0802 NOTICE OF PROPOSED COMMISSION 
ACTION; OFFERS IN COMPROMISE 

44 toe chairman is ef toe opinion that toe facto 
reported by a law enforcement officer warrant 
denial, suspension ef revocation ef a pormit, ef 
if sufficiont written objections hav e been toe4 
with to* Commission to warrant donial ef a pef- 
h«% toe Commission shall se«4 notice ef toe 
proposed action to toe applicant ef pormittoo. 

(a) Notice of Alleged Violation. If facts re- 
ported by a law enforcement officer indicate a 
violation of the ABC laws, the Commission shall 



send a Notice 
permittee 



of Alleged Violation to the 



which shall contain a short and plain 
and a reference to 



statement of the facts alleged 

the particular sections of the statutes or rules in- 
volved. The notice may also contain an offer to 
settle the case, and an indication of the procedure 
by which this may be accomplished. 

(b) Offers in Compromise. A permittee may 
enter into a stipulated settlement or offer in 
compromise pursuant to G.S. 18B-104, subject 



to ratification by the Commission. If a permittee 
indicates a desire for a hearing, or does not re- 
spond to the Notice of Alleged Violation, the 
Commission will file a petition with the Office 
of Administrative Hearings. Contested case 
procedures are governed by Chapter 15QB of the 
General Statutes and the rules of the Office of 
Administrative Hearings. 

Statutory Authority G.S. 18B-I04; 18B-203 (a) 
(12); I8B-207; I50B-22; 150B-23. 

.0805 SERVICE OF NOTICE 

44** Official Notice ef H e aring shall be sorvod 
personally by a» alcohol lew onforcomont agont 
ef by certifi e d moil, return receipt roquootod. If 
personal service is made, toe agent shall state toe 
eate ae4 timo ef sorvieo ef the notic e . Whon 

IIVIBAJ r7 OCTTT U T 1-^J1 1 U^^T 11 lUITy IT Jl lUri U\J Kl \,^J 1 1 1UU 

service was mad e e» toe date appearing e» toe 
return receipt. 

Statutory Authority G.S. 18B-207; 150B-1I; 
I50B-23. 

.0806 SLBPOENAS 

(a) 44*> attendance ef witnesses ef toe pfe- 
duction ef ovidonco including books, records, 
correspond e nc e a»4 documents at a» adminio 
trativo h e aring may be oompollod by toe issuanc e 
ef a subpoena, upon the Commission's own 
motion ef upon request ef a»y party. 
fb) Roquost tof Subpoena. Fioquost top toe 
issuanc e ef subpoenas shall be addrooood to toe 
Commission. 4-he roquost shall includo a concise 
bet complete otatomont ef roasons fef toe nocoo 
sity ef toe witnoss' tostimony ef toe production 
ef toe matorial. ¥be roquost shall alse includo 
toe following information: 

(44 name ef the contostod oaoo; 

£3) name afte. addrooo ef party roquosting toe 

subpoena; 
(4) namo ae4 address ef toe porson to whom 
toe subpoona is diroctod ae4 toe party e» 
whoso bohalf he is to tostify; aft4 
(4) a sufficiently particular designation ef toe 
ovidonco roquootod to be produced at toe 
hoaring. 

I s^\ Ci-n-rr«/>r^ n£ Cnknnnnnr A 11 f i ikr.^/in fif 1 EfiJ lpfl 

\^~ J L5(?l TILT? W LJWWJrilUU. I \H \J\l\,'^.'\J\-llULJ ITJUVU 

by a h e aring offic e r shall be serv e d m toe manner 
proocribod by G4>r 4A-4t ferie 4e(e)r 

(4) Enforcement ef Subpoona. If a person to 
whom a subpoena is direct e d fads to comply with- 
its ord e r, toe hearing offic e r met? apply to toe 
General Court ef Justice, Suporior Court Divi 
sion. fef a» ordor to show why toe oubpoonaod 
party should net be bel4 i» contempt ef toe 
ag e ncy. 



1652 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



-, hal l 



include tbe following informati oftr 

f3) namo m4 address ef party roquooting is- 
suanc e ef the oubpoonas, 

( J T ^TfTTTI\.- f J_T1 LI 1U UU1 UU11 Z\J TTTTT7TTT I 1 iv rrCTTTTT^TCTTCT 

is diroctod, 

(T) name aee. addroso ef party e» who go be- 
half witness is to testify, 

(4} sufficiently particular description ef the 
materials requested. 

Statutory Authority G.S. J8B-207; 1 SOB- 11; 
I50B-27. 

.0807 CHALLENGE OF SUBPOENA: 
PROCEDURE 

(a) Roquoot fef Provocation ef- Subpoena. The 

validity ef aey subpoena issued by the Commis 

sie» is subj e ct to challenge at toe roquost ef toe 

person to whom the subpoena is diroctod. Te 

challeng e a subpoona, the porson to whom it is 

diroctod shall file with- the Commission written 

objections ae4 reasons ther e for arte roquost m 

writing that the subpoona he revok e d ef modi 
f 1 l j 

(b) The porson se challenging the subpoena 
shall, simultaneously with- the filing ef h*s eb- 
joctions with the Commission, sorvo his eb- 
joction e» the party requesting the subpoona. 

(a) The party requesting the subpoona, within 
the tim e grant e d by the Commission, may file a 
writt e n rosponso to the objections. The response 
shall be sorvod » the samo mannor as the eb- 
jections. 



Statutory Authority G.S. 
150B-27. 



18B-207; 1S0B-11; 



.0808 CHALLENGE OF SUBPOENA: RULING 

Following roooipt ef objections, a written re- 
quest to modify ef revoke a subpoona, a«4 a&f 
rosponso to the objections, the Commission shall 

fl l I .1 Q r-i t Kii ;'h -i 1 1 ,in fifi nn;-| I t- n 1 in >-l 1 1 -r~t ttnn ,-H ,-i t~- 1 f J f~i w-i 

1 U1U Utl II1U Ul lUliLHI-v HI IU I'JJUU CT ^TTTT 1 VI I U WiynJl I . 

A copy ef the decision shall be issu e d to all par- 
ties aee. mad e a part ef the record ef the eea- 
tostod ease to which it applios. 



Statutory Authority G.S. 
J50B-27. 



J8B-207; 150B-11; 



.0810 PREHEARING CONFERENCE 

(a) Purpose. The purpose ef the pro hearing 
oonforonco shall be to discuss: 

(T) the possiblo simplification ef issuos, 
(3) the stipulation ef faets aee. issues, 
(T) areas where evidence will be needed, 



(4) whothor dopositions aee. subpo e nas will 

be necessary, 
fS) whothor consolidation ef cases ef joint 

hearing is foaciblo, aee 
(4) aey other matters which wiH reduce costs 
ef save tim e i» the disposition ef the case. 
(b) Oft Roquest ef Party. A»y party F»ay fe- 
quost a pro hearing conference by notifying the 
hoaring officer within a roasonablo timo after fe- 
ooiving the Official Notic e ef H e aring. 
(e) Upon Notic e from Hoaring Officor. The 
hoaring officer may hold a pro hoaring conforonco 
ae4 require attondanco ef aU partios, upon a rea- 
Gonablo written notic e to the partios involved. 
(4) By mutual agreement ef the parti e s, a efe- 
hoaring conforonco may be hel4 anywhoro within 
the State ef North Carolina. 

(e) Aey stipulation as to facts, issues, sad evi- 
donce shall be admissiblo at the hoaring aae. shall 
be binding upon aU partios. 

(£) The production ef evidence, including 
books, records, correspondence ae4 documents, 
at a pro hoaring oonforonco metf be compoUod by 
iosuanco ef a Gubpoona, upon the Commission's 
ew» motion ef upon roquost ef a»y party. 



Statutory Authority G.S. 
J50B-33. 



18B-207; 150B-11; 



.0811 INTERVENTION 

(a) A motion to intorvono as a party m a con 
tostod ease shall be grant e d if tbe potitionor files 
such motion to intorvono as provided » GtSt 
1A 1, Rul e 34r afi4 if the potitionor moots the 
criteria specified m Rulo 34r 

fb} Discretionary Intervention, fe addition to 
intervention as provid e d by Gr&? 1A 1, Rulo 3-b 
discretionary intervention f»ay be allowed upon 
efal motion at the initial hoaring, whon doomed 
advisable by the hoaring offic e r. Discretionary 
intervention wiH be doomed advisabl e whon: 
(T) The informat iea potitionor desires to 
present is relevant aee eet repetitious ef 
merely cumulativ e ; a»4 
(-3) The petitioner's participation would eet 
unduly burden the hoaring. 
(e) Timelin e ss. The written petition to inter 
vono shall be doom e d tim e ly made if 61e4 at any 
timo prior to tbe termination ef the final Com 
mission hoaring. Provided that seeh petition to 
intervene wtff eet be granted if the intervention 
ef the potitionor would caus e substantial proju 
eiee to the rights ef the partios. 

(4} Filing Motion; Contents. A porson dosir 
iftg to intervene i» a contest e d ease shall file a 

T-t->,-»-i i^n \i -i tK 4 X-i.-\ kflaaia a aiaflflt nn d r.ni 1 1 lnr*!! iHp 

tTTTTTTTTTT TTIlll 11 H? I 1WJ.I 11 1 C TJllH-*-l , LLL1U Jl 1UU UIL'IUUU 

the following information » the motion: 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1653 



PROPOSED RULES 



(4) citation ef a»y otatutory ef non statutory 
grounds fof intervention, 

(3) statement ef the claim ef dofonoo upon 
which intervention is sought, 

(5) petition e r's name afto address, 

(4) petitioner's business ef occupation, 

£e4 name ef the contested ease » which 
petitioner wishes to become a party, a»4 
(4) concise summary ef the arguments ef evi- 
denc e which petition e r sooks to pres e nt. 
(e) Allowing Motion to Interven e . If the 
hearing oiTioer allows a petitioner's motion to 
intervene, he shall send prompt notice ef toe 
petitioner's intervention to aH partios. 

(£)■ Denying Motion to Intorvonc. ff the hoar 
m§ officer deni e s the petitioner's motion to m- 
torvono, he shall send prompt notice to the 
petitioner ase other partios, stating the reasons 
fof his decision. 



Statutory- Authority G.S. 
150B-23. 



18B-207; 150B-11: 



.0812 DISCOVERY 

(a) Aft aggrieved party to a contested ease may 
discover information from records ef the Com 
mission. 
fe} Discoverabl e materials include: 
(44 investigative report ef the ALE ag e nt ef 

local ABC officer, 
(rfy findings ef faet ae4 recommendations ef 

the hearing officer, 
(4) transcript ef the hearing heto. by the hoar 

iȤ officer, 
£4} transcript ef the hearing beforo the Com 

mission, a»d 
fe4 asy agency records relating to material 
facts involved » the contested case. 
fe) At the hearing ef a contest e d cas e , whether 
before the hearing offic e r ef the Commission, a 

>-. --i ft t - ,— > t- T~t i c- fittn T-n t\i I r-r-, -1 \ - r\ \. r ■-< t-ti i n rt ^^J, n rl 'l n l it -in.i 
[.'HI T T C^T rTT^ CITTTTT lit T 1 1 1U T *J^U-1 1 I_l_l IV O I J Tl I 1 L 11. 1 1 UJ. 1U 

physical evidenc e to he used against him. 

£44 to. cases ef unreasonable hardship to the 
partios ef witnesses, the «se ef a deposition may 
be allowed i» the discretion ef the hearing officer 
befor e whom the ease is to he h e ard. When a 
deposition is allowed, it may he used fo hee ef 
other evidenc e when taken to accordance with 
&&,4A-4t 

(e) is addition to the discovery otherwise au- 
thorized by this Rul e . » any ease i» which the 
commission r e c e iv e s a request foe a hearing in- 
volving the malt beverage ef wine franchise aet 
[G^n fSB 1 1 09(b) aito 444^ aad G&? 1 SB 1200 
through 1216, respectively], disco very by the 
commission a»4 aH parties is governed hv the 
Rules ef Gmi Procedure £&£* 4A-4^ 



Statutory Authority G.S. J8B-207; J50B-JI; 
150B-28. 

.0814 FILING AND FORM OF BRIEFS: 
MOTIONS: DOCUMENTS 

A»y document, motion, petition, r e qu e st ef 

^^^^^^^ ^^i I"' '' ^ ' ' ' ' \ ,l • i t I \ t >~i Q Ljijnoi^cmn ^^C H , ' i 1 " 1 T-1 ' ' 

officer shee. he personally deliver e d ef seat by- 
regular ef registered mail to the North Carolina 
Alcoholic Beverag e Control Commission, P.O. 
Be* 3eeS4r Raleigh, ^tofto Carolina 276 1 1 6687; 
e xcept that whenever hearings are he!4 by a 
hearing officer to aey plac e other than R.al e igh, 
documents pertaining thereto may be filed at the 
hearing. 

Statutory Authority G.S. 18B-207; 150B-11; 
150B-28. 

.0815 CONTINUANCES 

fa} Request fef Continuance. Requests fof a 
continuance shall be mad e to the hearing officer 
at least twe working days prior to the date ef the 
hearing, stating to d e tail the reasons why such 
continuance is necessary. Pef good causo 
shown, the Commission ef hearing officer mm- 
grant the request fof eontinuanco ef the hearing 
ef a contested case. 

fb4 Q» Motion ef Commission ef Hearing 
Officer. 44*e Commission ef the hearing officer 
may, at a»y time, order a continuanc e . 

(e) Untimely Re quests. Requests fof contin 
uancos received less than e*e working days prior 
to the time fixed fof hearing wili »et be granted 
except where there e xists a bona fide emergency 
ef whore justice as4 fairn e ss to ae. partios w4H he 
bett e r achieved. 

(4) Place ef Reschedul e d Hearing. Upon the 
granting ef a continuance, the hearing f»ay be 
rescheduled as provided to R.ule .0809 ef this 
Section. 

Statutory Authority G.S. 18B-207; 150B-11; 
150B-28. 

.0816 DISQUALIFICATION OF HEARING 
OFFICER 

(a) ffr fof afty r e ason, the hearing offic e r as- 
signod to conduct the hearing ef a contested ease 
determines that personal bias ef other factors 
would prevent htfft from being able to conduct 
the hearing affo p e rform ah 1 duties to a» impartial 
manner, he shall submit a statement m writing 
to the chairman stating his disqualifications a»d 
the reasons therefor. 44*e chairman shall there 
upon designat e a different hearing officer to hear 



1654 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



/VA Tft tUa jit r,-m+ n n w nirtlf IMMiMMMBUB tn.'lt MM 

1 XT J TTT TTtt? OYt'l II CtTT^r I Jill IF TTU U\J < VJ RRR IICTJ 

hoaring offic e r assigned to bear the 6ase is pep- 
oonally biased ©p disqualified, he may objoct to 
such allogod disqualification by filing, in- good 
faith, sworn affidavit with the chairman ef the 
Commission. The affidavit shall state ah facts 
aftd- roasons supporting his objection. 

(■!■) The affidavit shah he filed- before com 
monoomont ©f the hoaring, provided, 

Vt ah -.it -.-if t Vt ■-» t tl-i ^ ri'iri t r rn '-\\; TY\'~l\fflk Mil 

1 to n" t pi , inui n ic ltui it TT^cry^ I IICU117 \J\7 

j e ction to the disqualification ©f the hear 
»g officer a* the ftpst opportunity aftep he 
becomes awar e ©f facts giving nse to a 
reaoonablo belief that the hoaring officer 
may- he disqualified, notwithstanding the 
faet- that the hearing may have com 
moncod. 

(3} Objection during Hoaring. tf a party 
mak e s objection during the hearing to the 
disqualification ©f the hearing offic e r, the 
hoaring officer shah m>te saeb objection 
m the rocord an4 proceed with the hoar 
mgr 

(T) Request top Rehearing. After the hoaring 
is adjourned, the party objecting to the 

*JU\XII_lIUrTTTT^TT \Ji 1 1 IV 1 1 UU I II I B I J 1 1 1 \J\. I 1 1 IU T 1 11U 

a sworn affidavit with the chairman , stat 
»g ah facts afi4 roasons supporting his 
objection, a»4 request a rehearing before 
a dilToront hearing officer. The chairman 
shall mak e a determination based upon 
ah available facts whothor the officer 
hoaxing the ease was m faet unabl e to 
conduct the hearing m an- impartial man 

(A) hf the chairman determines there is 
sufficient evidonco ©f disqualification ©p 
bias, he shall dosignato a difforont hoaring 
offic e r an4 caus e notice ©f r e h e aring to he 
sest to ah parties m the came manner as 
any other notice of hearing. 

fB) if the chairman - detorminoo there is m- 
suffici e nt evidonco ©f bias ©p disqualifica 
tion, he shall deny the request fop a 
rehearing. Notico ©f the d e nial ©f the re- 

I i I I , > I t 1-1-imI] W ■ i Mill + r-i <i I I n ■ I «-4 iiif n «-i , 1 i l-t'ill 

state the r e asons th e refor. The hoaring 
officer may proceed with his findings ©f 
faet ami recommendations to the Com 
mission. 
(T> The affidavit alleging disqualification ef a 
h e aring officer ami the findings ©f the 
chairman shah he made a papt ©f the re- 

l-T^TTT T^T liIC LUJL 1 , HI IVJ HI IUII T^P 3QQTQR tTT 

judicial roviow at the instanc e of the ©b- 
jecting party. 



Statutory Authority G.S. 18B-207; 150B-1I; 
150B-32. 

.0817 UNAVAILABILITY OF HEARING 
OFFICER 

/ <-i\ If o h^nnrMi ""■ /■>■-«»• Iat 'inif ran gflja * O lm n Vklii 

rrrr tt cr nTOnrrc v^ 1 1 1 *~"\j 1 e iui lu it i \ju.lit._'i i , r^ unuuiu 

to comploto the hoaring ©f a contostod caso, the 
chairman may dosignato another hoaring offic e r 
to continue the h e aring ef the cas e . 

fb) Subsequent to the designation ©f a succeo 
sop hoaring officer, the hearing shall continue 
from that point reached m the proceedings when 
the original hoaring officor bocamo unavailable, 
provided, howovor: 

(4) If a witness has previously testified as to 
material facts aft© the hoaring officor be- 
lieves that- the demoanor ©f the witnosG is 
apt- important e l e ment ©f the tostimony, 
the hearing officor may ordor that e xam 
ination ©f that witness he ropoatod. 
(3} U the dir e ct tostimony ©f a witness has 
been complotod before the resumption ©f 
the hoaring, bet cross examination has 
©©t boon complotod, the hoaring officer 
p»ay order that the direct oxamination he 
ropoatod. 
f3) If apty party ea» show that- continuation 

/ tt-.-\«-*i tFj^i i~i t \ i t-i t r iy n • [T | \i I ul 1 r 1 1 > I i l "f \ ii ' i l i ^ i I I 7 1 ' ■ ' ■ ■ 
^T^X^^^T ^^^^C i 'I'lin i v ti v i i vu ill x^^^C l_' i v^ v \- wvjiii^^^J 

before the original hoaring officor) wih re- 
sult m substantial prejudice, the hearing 
offic e r shah order a rw hearing. 



Statutory Authority G.S. 
I50B-32. 



1 SB- 207; 1S0B-11; 



.0818 HEARING PROCEDURE 

fa) Failure to Appear. U a party fails to appear 
after proper sorvioo ©f notic e , the hearing officor, 
if m> adjournment is grant e d, may proceed with 
the hoaring. 

fb) The parties a»4 witn e ss e s testifying at- a 
hoaring shah be f>«t und e r oath. 

(a) The hearing shall be recorded. 

fd} Appv aggrieved party ©f his attorney shall 
be permitted to introduc e evidonco af*4 witness e s 
i» his behalf, present arguments ©» issues ©f law 
©p policy, examine ah written a«4 physical evi- 
donco to be used against him, a«4 cross examin e 
ah- witness e s testifying against him. 

(e} Obj e ctions to the notice, procedure, quali 
fications ©f the hearing offic e r, conduct ef the 
hoaring officer ©p ©f a»y party, ©p to the admis 
si©» ©p exclusion ©f evid e nc e , afai any exceptions 
taken to s«eh action shah be noted m the record 
by the hearing officor. 

(£) Ah persons appearing m hoaring p*©- 
coodings » a representativ e capacity shall con 
form to the standards ©f ethical conduct required 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1655 



PROPOSED RULES 



ef attorneys practicing m the courts ef thi» Stato, 
as set forth m the Canons ef Ethics ef the North 
Carolina Stat e fief aft4 the Cod e ef Professional 
Responsibility. 

(g) 44*e hearing officor may cause te be fe- 
moved from the hearing aey- person causing a 
disturbance therein. 

Statutory Authority G.S. 18B-207; IS0B-11; 
150B-25. 

.0819 FINDINGS: CONCLUSIONS: 

RECOMMENDATIONS OF HEARING 
OFFICER 

ah the evidonoo, record hi* findings ef feet? hi* 
conclusions ef ke*^ ae4 proparo a rooommonda 
tie» fof action ee- the application ef p e rmit , te- 

natjT3f- ifitVi * V-» ,-\ /-\ Hi Aiil I /-t fri m i f f | /-> r-i r^^^^^^^i r-\ T rmi; 
ED II 1 \-'x tTTTTT 1 1 IV \T1 I IT-'IUJ V T_' 1 I 1 1 1 II '..I.1W.1 1 1 1 L^_^__TI \J \JI (II IT 

prior disciplinary action taken against the party 
by the Commission ef ae alcohol law enforce 

shall r e c e iv e a copy ef the findings, conclusions 
ae4 recommendations i» the ease prior te the 
Commission mooting when final disposition wih 
be mado ef the cas e . 



Statutory Authority G.S. 18B-207; 
150B-34. 



150B-II; 



.0820 FINAL ADMINISTRATIVE DECISION: 
HEARING 

(a) Right to be Present at Final Administrative 
Decision; Notice. Each party to a contested case 
and his attorney of record shall receive reasonable 
notice of the location, hour and date when the 
findings of fact and recommendation of the 
hearing officor administrative law - judge will be 
reviewed by the Commission for a final disposi- 
tion of the case. This notico shall be sewed as 
provided by- R-ele .0805 ef this Section. 

(b) Continuances. The chairman may grant 
continuances for just cause upon two working 
days oral or written notice. 

(c) Service of Notice. Service of notice of final 
administrative action shall be m accordance with 
P>.ul e .0805 ef this Section, bv certified mail. If 
notice is accomplished by certified mail, the de- 
livery date on the return receipt shall be the date 
of notice. If service cannot be made by certified 
mail, then the notice will be served personally or 
in accordance with G.S. 1A-1, Rule 4 (jl). 

Statutory Authority G.S. 1SB-207; 150B-36. 

.0821 ARTICLE 12 HEARINGS; PETITION 
AND NOTICE 

(a) Initiation of Hearing. A hearing under 



(Wine Distribution Agreements Act) shall be 
commenced by the filing of a petition with the 
Commission. The petition shall state the party's 
contentions in detail, and set forth 
chronologically the events surrounding the 
winery's termination of the agreement. 

(b) Requests for Relief. In any case in which 
a wholesaler requests that the Commission pro- 
vide relief in a dispute with a winery under Arti- 
cle 12, the Commission may deem that request 
to be in the nature of a request for a hearing, and 
may conduct a hearing to determine if the winery 
has good cause to terminate an agreement with 
the wholesaler, or to determine if the wholesaler 
has rectified the reasons given bv the winery for 
the termination. 

(c) Notice of Hearing. A Notice of I tearing 
shall be mailed to the parties in a dispute under 
Article \2 at least 15 days prior to the hearing. 
The notice will be served by certified mail or in 
accordance with G.S. 1A-1, Rule 4 (jl ). In the 
event service is made bv certified mail, the deliv- 
ery date on the return receipt shall be the date 
of notice. The notice will contain a short and 
plain statement of the issues to be resolved bv the 
Commission, the date, time, and place of the 
hearing, and the name of the hearing officer who 
will conduct the hearing, if the Commission de- 
termines that it will not preside at the initial 
hearing. 

(d) Rules of Procedure. Hearings conducted 
under Article 12 of Chapter 18B of the General 
Statutes will be conducted in accordance with the 
Rules of Civil Procedure as contained in G.S. 



1A-1, and the General Rules of Practice for the 
Superior and District Courts as authorized by 
G.S. 7 A- 34 and found m the Rules Volume of 
the North Carolina General Statutes. 



Statutory Authority G.S. I A- J, Rule 4(jl); 
7A-750; ISB-203(a)( 1 ),(2); 18B-207; J8B-J205. 

.0822 ARTICLE 12 HEARINGS; EVIDENCE 

The provisions of G.S. 150B-29 relating to evi- 
dence shall apply to hearings conducted under 
Article J_2 of Chapter 1SB of the General Stat- 
utes. 

Statutory Authority G.S. 18B-203 (a)(1), (2); 

18B-207; 18B-1204; 1 SB- 1205. 

.0823 FINAL ADMINISTRATIVE DECISION; 
ORDER 

(a) Right to Submit Proposed Findings. The 
parties in a hearing conducted under .Article 12 
shall have an opportunity to file proposed 
findings of fact and conclusions of law within 30 



Article 12 of Chapter 1 SB of the General Statutes days of the conclusion of the initial hearing. 



1656 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



(b) Recommended Decision. If a hearing 
conducted under Article Y2 is presided over by a 
hearing officer, the hearing officer shall issue a 
recommended decision that contains proposed 
findings of fact and conclusions of law. The 
hearing officer shall serve a copy of the recom- 
mended decision upon all parties and the mem- 
bers of the Commission who will make the final 



administrative decision. 



Service shall be in the 
■0821(c) of this Sec- 



manner prescribed in Rule 
tion. 

(c) Exceptions. The parties to a case heard 
under Article J_2 shall have the right to file writ- 
ten exceptions to a recommended decision by the 
hearing officer. Exceptions shall be tiled with the 
Commission within 30 days of receipt of the re- 
commended decision. 

(d) Hearing Conducted by Commission. In 
lieu of assigning a hearing officer to preside over 
the initial hearing, the Commission may conduct 
the initial hearing. After the time for the fifing 
of proposed findings of fact and conclusions of 
law by the parties has expired, the Commission 
will issue a final administrative decision and order 
that determines the issues set forth in any prior 
pre-hearing order. 

(e) Petition to Office of Administrative 
Hearings. In any case heard by the Commission 
under Article L2 of Chapter 1 8B of the General 
Statutes, if the Commission finds evidence of vi- 



or any 



olations of Article 12 of Chapter 18B, 
other ABC law, it may commence proceedings 
in accordance with the provisions of Rule .0802 
of this Section. 



Statutory Authority G.S. 18B-203(a)( I ),(2); 
I8B-207; 18B-I205; 18B-I207(c); 150B-23. 

SECTION .0900 - FISCAL RULES FOR LOCAL 
BOARDS 

.0901 BORROWING MONEY 

Before a local board borrows money, it shall 
consider the following factors: 

(1) the number of stores in a service area; 

(2) the estimated population in a service area; 

(3) the location of stores in a service area; 

(4) the nature and amount of the outstanding 
debt of the local board; 

(5) whether the borrowing is for the purchase 
of fixed assets, inventory or both; 

(6) the adequacy of the accounting system used 
or proposed to be used by the local board; 

(7) the unit's its compliance with rules of the 
Commission; 

(8) history of operating profits; and 

(9) projected profits and ad e quacy ability to 
cover retire the debt. 



Statutory Authority G.S. 18B-702(b),(e). 

.0902 MAINTENANCE OF WORKING 
CAPITAL 

(a) "Working Capital" means the total of cash, 
investments and inventory less all unsecured li- 
abilities. 

(b) A local board shall set its Working Capital 
requirements at not less than two weeks' average 
gross sales of the last latest fiscal year nor greater 
than four months' average gross sales of the last- 
latest fiscal year. Gross sales means gross re- 
ceipts from the sale of alcoholic beverages less 
distributions as defined in G.S. 
18B-805(b)(2),(3), and (4). 



Statutory Authority G.S. 18B-702 (e); 

(d). 



18B-805 



.0906 FINANCE OFFICER: DUTIES 

(a) The general manager of each local board 
shall serve as finance officer. The local board 
may designate deputy finance officers to aid the 
officer in the performance of his duties and per- 
form other duties delegated to them by the fi- 
nance officer or the local board. 

(b) The finance officer shall: hav e the follow 
tag dutioo: 

(1) He ohall keep the accounts of the local 

board in accordance with generally ac- 
cepted principles of governmental ac- 
counting and the rules of the 
Commission; 

(2) He shall disburse all moneys of the board 

in strict compliance with these Rules; 

(3) He shall prepare statements of financial 
condition as often as the governing board 
required requires information; 

(4) He shall receive and deposit all moneys re- 

ceived or supervise the receipt and deposit 
of money by other authorized employees; 

(5) He shall supervise the investment of idle 

funds of the local board; 

(6) He shall ensure that all internal controls 

established by the local board are fol- 
lowed; and 

(7) He shall perform other duties as may be 

assigned to him by law, by the local board 
or by the rules of the Commission. 

Statutory Authority G.S. 18B-702(e). 

.0909 TRAVEL POLICIES 

(a) Travel Policy Required. Each local board 
shall adopt and adhere to rules establishing travel 
policies to govern the following activities: 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1657 



PROPOSED RULES 



(1) responsibility of board members and em- 
ployees in incurring expenses while trav- 
elling on board business; 

modes of transportation authorized for 
travel on official business; 



(21 

(3) reimbursement allowances for travel, in- 

(41 

(5) reimbursement allowances for conference 



eluding mileage reimbursements; 

reimbursement allowances for lodging 
and meals; 



(61 
(21 

1*1 



or convention registration fees; 
travel advances; 
authorization for travel; 



incidental travel expenses including tips, 
tolls, parking fees, taxi fares, and rental 
vehicles; 
(9) telephone calls made while travelling; and 
( 10) reimbursement procedures and doc- 
umentation of expenses. 
The travel policy rules and subsequent amend- 
ments shall be made asailable to each employee 
and board member. 

(b) Rules to Conform to Local or State Poli- 
cies. Travel policy rules adopted bv a local board 
shall conform, at a minimum, to travel policies 
adhered to by either the local appointing author- 
ity or the Office of State Budget and Manage- 
ment of the State of North Carolina. 

(c) Rules to be Filed with Commission. Each 
local board shall file a certified copy of its travel 
policies and procedures, and any amendments 
thereto, with the Commission within 11J days of 
the adoption, or amendment, of the policies by 
the local board. 

Statutory Authority G.S. JSB-702(eJ. 

SECTION .1000 - LOCAL ABC BOARD: 
PERSONNEL POLICIES 

.1008 CONFLICTS OF INTEREST 

(a) Financial Interest Prohibited. No local 
board member or employee shall have any direct 
or indirect interest in any manner whatsoever in 
any firm, corporation, company or enterprise 
that manufactures, produces, buys, mixes, bot- 
tles, sells, stores or transports spirituous liquors. 
liquor. 

(b) Employment of Relatives. No local board 
shall employ in any capacity any person related 
to a local board member or member of any other 
authority that appoints members of the local 
board by blood to a degree of first cousin or 
closer, nor shall the spouse of any board member 
be employed by the board. 

(c) Employment of Board Members. No 
member of a local board shall be employed in 
any capacity by the board, nor be paid or receive 



any compensation of any kind from the board, 
except for compensation as a member thereof, 
which compensation has been established by the 
Board e* othor appointing authority. No local 
board member nor oth e r member of the local 
governing authority that appoints members of 
the local board shall be appointed as manager of 
a store, or manager, supervisor, director or ad- 
ministrator of the local system. No member of 
a board or other appointing authority that ap- 
points members of a local board shall be em- 
ployed in any capacity by that local board. The 
local board shall carry out its powers and duties 
as a board and shall not delegate the operation 
of the system to individual members. 

(d) Contracts Prohibited. Members of a local 
board, acting on behalf of the board, shall not 
enter into any contracts or agreements or be in 
any manner interested in any contract or agree- 
ment for their own benefit or in the profits 
thereof, whether privately, openly, singly, or 
jointly with another member of a local board. 

Local boards shall not, on behalf of the board, 
enter into any contract or agreement of any kind 
with: 

( 1 ) any member of any other authority that 
appoints members of the local board; 

(2) any person who is related by blood to any 
member of the board to a degree of first 
cousin or closer; or 

(3) any spouse of a board member. 

(e) Membership on Appointing Board Prohib- 
ited. No member of the local board shall be a 
member of the appointing authority that ap- 
points the local board while serving as a member 
of that local board. 

(f) Exceptions. Notwithstanding the pro- 
visions of this Section, the Commission may 
grant exceptions from this Rule in cases of ex- 
treme hardship and where the public interest 
would not be placed in jeopardy. 

Statutory Authority G.S. 18B-201; 18B-207; 
18B-700 (g). 

.1009 PERSONNEL MANUAL 

(a) Each local board shall establish policies and 
rules governing each of the following: 

( 1 ) Initial employment of employees, includ- 
ing qualifications and requirements for 
new employees; 

(2) Compensation and benefits; 

(3) Hours and davs of work, holidays, vaca- 
tion, sick leave and other matters pertain- 
ing to the conditions of employment; 

(4) Promotion, transfer, demotion and sus- 
pension of employees; 



(5) Separation or termination of employees; 



1658 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



(6) Granting of salary increases; 

(7) Employee grievance procedures; and 

(8) Any other programs or procedures as may 
be necessary to promote efficiency and to 
provide for a fair and reasonable system 
of personnel administration. 

(b) A local board is encouraged to model its 
personnel policies and procedures after those 
adopted by the county or municipality in which 
it operates. 

(c) A local board shall not adopt a rule or 
policy that conflicts with the provisions of 
Chapter 18B or these Rules. 



Statutory Authority G.S. 
18B-701(2); 18B-807. 



18B-203 (a) (10); 



SECTION .1200 - OPENING AND 
DISCONTINUANCE OF STORES 

.1203 APPROVAL OF NEW STORES 

(a) Notice to Commission. The opening of 
any new ABC stores will not be approved by the 
Commission unless at least 30 days notice is 
given to the chairman as to the intended location 
of such store and until a public notice of the in- 
tention to open such ABC store has been posted 
for 30 days at such location. 

(b) Sign Requirements. In order to meet the 
public notice requirements of Paragraph (a) of 
this Rule, the local board shall post at least one 
sign at the proposed new store site in accordance 
with all the following requirements: 

(1) Dimensions of the sign shall total at least 
three square feet; 

(2) The Board shall state on the sign its in- 
tention to open an ABC store on the site; 

(3) Lettering and background colors shall be 
of sufficient contrast, and lettering shall 
be of sufficient size, so that the notice will 
be legible to passersby; 

(4) The sign shall be posted within three feet 
of the public road or sidewalk that will 
run in front of the proposed store, or if the 
proposed store will be in a shopping cen- 
ter, the sign shall be posted on the front 
exterior of the existing storefront or 
building. 

Statutory Authority G.S. 18B-207; 18B-801. 

.1205 CLOSING OF STORE 

An ABC store may be closed when it is not 
operated in accordance with the ABC laws, when 
it becomes a nuisance to the community in 
which it is located or when its continued opera- 
tion becomes undesirable for financial or any 
other substantial reason. 



Statutory Authority G.S. 18B-207; 18B-80I. 

SECTION .1400 - PURCHASE OF ALCOHOLIC 
BEVERAGES BY LOCAL BOARDS 

.1401 PURCHASE LIMITED TO APPROVED 
BRANDS 

Except for special orders, no purchases of any 
spirituous liquor or fortified &f unfortified wine 
shall be made by any local board other than 
brands approved for resale in ABC stores by the 
Commission. 

Statutory Authority G.S. I8B-207; 18B-800(c). 

.1402 PERMIT REQUIRED TO SELL 
ALCOHOLIC BEVERAGES 

No purchase of any spirituous liquor or fortified 
©f unfortifiod wine for resale in ABC stores shall 
be made by any local board from any person that 
does not hold a permit from the Commission 
authorizing the sale of those beverages to the lo- 
cal boards, except that approved brands of 
taxpaid liquor may be purchased for resale from 
the board of county commissioners of any 
county for an amount not to exceed the usual 
wholesale price of the liquor when liquor has 
been confiscated for a violation of the ABC laws. 
A local board shall purchase fortified wine only 
from a North Carolina wholesaler who has been 
issued a wine wholesaler permit. 

Statutory Authority G.S. 18B-207; 
18B-503(e); 18B-1 107(a)(2). 



18B-304(a); 



.1407 PAYMENT 

(a) Local boards shall remit full payment of the 
contractor's statement of account pertaining to 
the bailment fee within 30 days of receipt of the 
statement. 

(b) Local boards shall remit full payment of the 
contractor's statement of account pertaining to 
the bailment surcharge within ZQ ]_5 days of re- 
ceipt of the statement. 

(c) Local boards shall remit full payment of the 
distiller's invoice within 30 days of delivery of the 
liquor. 

Statutory Authority G.S. 18B-207; 18B-702(e). 

SECTION .1500 - PRICING OF SPIRITUOUS 
LIQUOR 

.1503 SPECIAL PURCHASE ALLOWANCES; 
POST OFFS; PASS THROUGHS 

(a) Temporary Price Reductions. The Com- 
mission will, from time to time, reduce the retail 
prices of selected liquor products to reflect man- 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1659 



PROPOSED RULES 



ufacturer or importer offers of special price re- 
ductions. 

(b) Selection of Items. Individual liquor pro- 
ducts will be selected for retail price reductions 
based on the following criteria: 

( 1 ) Amount o\_ reduction offered bv industry' 
member; 

(2) Profitability of product; 

(3) Sales histon of product; 

(4) Quantity of product available; and 

(5) Marketing support offered by industry 
member. 

(c) Otters of Reductions. In order for a prod- 
uct to be considered, an industry member shall 
file, within the time set bv the Commission, spe- 



cial purchase allowances offered for its products. 

(d) lime Periods. If approved bv the Com- 
mission, the reduction of the retail price of a liq- 
uor product will be in effect for a period of 30 
davs. The Commission will notify industry 
members and local boards at least 30 davs in ad- 
vance of the effective date of a reduced pnee for 
each approved price reduction. 

(e) Supplemental Price lists. The Commis- 
sion will publish additional price lists indicating 
price reductions to supplement the quarterly 
price lists published in February. May. August 
and November of each year. Supplemental price 
lists shall be made available bv each local board 
in each of its ABC stores, and all reduced prices 
shall be posted bv either affixing the price of the 
product to the shelf or affixing a price sticker on 
the container. Additional signs may be utilized 
by an ABC store to notify customers of the price 
reductions. 

(f) Reduced Prices Fffective Statewide. A local 
board that sells a product selected for a tempo- 
ran' price reduction shall sell that product at the 
reduced price for the entire period the lower price 
is in effect . 



Statutory Authority G.S. 18B-203(a)(3); 
18B-207; 18B-702(e); 1SB-804; J8B-S07. 

SECTION .1700 - RETAIL SALES OF 
ALCOHOLIC BEVERAGES 

.1701 REMOVAL OF BEVERAGES FROM 
ABC STORES 

(a) Spirituous liquors, liquor, either distressed 
or otherwise, shall not leave the custody of a lo- 
cal board after receipt unless: 

( 1 ) The spirituous liquors are liquor is sold 
at retail; or 

(2) They are The liquor is returned to the state 

ABC warehouse. 
Any spirituous liquors liquor leaving the local 
board without being sold at retail or returned to 



the state ABC warehouse constitute constitutes 
nontaxpaid spirituous liquors, liquor. 

(b) Distressed Liquors. Liquor. Distressed 
liquors liquor shall be destroyed and the de- 
struction witnessed by the manager or his 
designee and a distiller representative. A De- 
struction of Unsaleable Merchandise Report 
shall be completed and signed by the witnessing 
parties. Copies of the report shall be sent to the 
distiller and the Commission. 

(c) No sales of alcoholic beverages shall be 
made to employees, board members or other re- 
tail customers on credit. This Rule shall not 
prohibit purchases made bv the use of credit 
cards where such sales are permitted by the 
Commission. 

Statutory Authority G.S. 18B-806; 18B-807. 

.1703 STORES: STATE LIST 

(a) Appearance of Stores. Stores shall be 
well-lighted and immaculately clean at all times. 
Stores not in compliance may be ordered closed 
by the Commission until deficiencies are cor- 
rected. 

fb) Display e4> Beverages. A44 beverages shall 
be displayed equally a&<& ho vendor's reproson 
tativo eaay interfere with ef suggest how bis 
product should be displayed. 

(e) Display Cases. Display cas e s may be used 
ift stores upon approval by- tbe local board. 
When display cases are used, a«e bottle e£ e ach 

< f .-k m ■-* t- Krini-1 rr\l,-1 l-i T - tb.i ( t i -i r. \ ■.- T-i j i 1 1 r^^ 1 3 i C P 1 ' I ' " i ^ I 1 

If I. I I T ^^r C^^t^^^^T ^^^^^CT ^^^r ^^^^7 ^^^^^^^" ^^^TC^^T ^^^r ^^^TTO» v vi 

» 4 T. .-. ,-» ri ,~ ,-\ r-, r-\ ,-i iii,'k it^|T\ r\ r kr-inil r l-i o 1 1 1^^ 
TT^^ ^^^^^^ C^T^TT C^^^^^T ^^^^^^ ^^T ^^^^^^^^X ^^^TC^^T ^^^ 

properly priced m t«e display. 

(b) (4) State List to be Posted. Available. Ev- 
ery store shall post make available for its cus- 
tomers' inspection a copy of the most current 
complete state price list t» t«e lobby, and any 
supplemental price lists. A local board may draw 
up and post its own price list for items or brands 
sold in its stores, provided the items and prices 
listed on the local list are also listed on the com- 
plete state list. 

Statutory Authority G.S. I8B-807. 

.1704 SALE OF WINE 

(a} Fortified wine may- be sela by a local board 
ia aae ef more ef its stores. 

f^ Fxcept a* provid e d m G^ 1SB S00(b)(2), 
»f a* specifically provided ia a local aet- p e rmit 
taaj (4*e sale e£ unfortified wine by- a local board, 
such wine shall ae4- be s©44 » a local store. 

Statutory Authority G.S. 18B-800 (b); 18B-804 

(c); 18B-807. 



1660 



6:22 NORTH CAROLINA REGISTER February 1 '4, 1992 



PROPOSED RULES 



.1707 SALES RECOMMENDATIONS 
PROHIBITED 

Sales talks e? r e commendations W e mployooo 
fof e* again ot aey particular it e m e* brand ef aJ- 
coholic bovorago are forbidden. 

Statutory Authority G.S. 1SB-S07. 

.1708 MAXIMUM QUANTITIES ALLOWED 
TO BE SOLD 

Employees of local boards are expressly pro- 
hibited from selling more than fow five liters of 
fortified wine or spirituous liquor or more than 
30 five liters of unfortified wino the two com- 
bined to a person at any one time, except as au- 
thorized under G.S. 18B-403 and G.S. 18B-404. 

A copy of all Purchase/Transportation Permits 
shall be maintained by local boards for a period 
of one year following issuance. A copy of all 
Mixed Beverages Purchase/Transportation 
Permit/Invoice forms shall be retained by the lo- 
cal board for a period of at least three years. 

Statutory Authority G.S. 18B-207; 18B-403; 
18B-404; ISB-807. 

.1710 CREDIT CARD SALES 

A local board may allow customers to purchase 
alcoholic beverages with credit cards so long as 



all the following conditions are met: 

(1) The local board tiles with the Commission 
a written request for approval to implement 
the use of credit cards, and furnishes in that 
request the following: 

(a) proposed date of implementation; 

(b) proposed bank or institution for clearing; 

(c) proposed discount rate; and 

(d) whether instant verification equipment will 
be used; 

(2) The local board must receive written au- 
thorization from the Commission to allow 
credit card sales; and 

(3) The minimum alcoholic beverage purchase 
that may be charged to a credit card is 
twenty dollars ($20.00). 

Statutory Authority G.S. 18B-203 (b); I8B-702 
(e); 18B-807. 

SECTION .1800 - PURCHASE - 

TRANSPORTATION PERMITS FOR 

INDIVIDUALS AND MIXED BEVERAGES 

PERMITTEES 

.1801 PURCHASE-TRANSPORTATION 
PERMITS: WINE: LIQUOR 

(a) Local Board to Issue. Whenever a person 
desiring to purchase more than 20 liters of un- 
fortified wine, or more than fow five liters of ei- 



ther fortified wine or spirituous liquor or fo«f five 
liters of the two combined, applies to a local 
board for a Purchase-Transportation Permit, the 
local board shall issue the purchaser such a per- 
mit, following the guidelines of G.S. 18B-403. 

(b) Form. The Purchase-Transportation Per- 
mit shall be issued on a printed three-part form 
and shall specify the following information on 
the face of the permit: 

(1) the name and location of the store from 
which the purchase is to be made; 

(2) whether the purchase is for unfortified 
wine, fortified wine or spirituous liquor; 

(3) destination of the alcoholic beverages in- 
cluding name and address of location; 

(4) Special Occasions Permit number of a lo- 
cation, if alcoholic beverages are pur- 
chased for a special occasion; 

(5) time and date of commencement and 
conclusion of special occasion, if any; 

(6) quantity and type of alcoholic beverages 
purchased; 

(7) signature of local ABC official issuing the 
permit; 

(8) name, address and driver's license number 
of purchaser. 

The form shall contain a statement that the per- 
mit is valid for only one purchase on the date 
shown and will expire at 9:30 p.m. on the date 
of purchase and a further statement that the per- 
mit shall accompany the beverages during trans- 
port and storage and be exhibited to any law 
enforcement officer upon request. 

(c) A local board issuing a Purchase- 
Transportation Permit shall retain one copy of 
the permit in its files for a period of one year and 
give the purchaser two copies, one of which the 
purchaser will give the store from which the al- 
coholic beverages are purchased. 

Statutory Authority G.S. I8B-207; 18B-303(a); 
1SB-403. 

.1803 CABINET PERMITTEES; PURCHASE 
-TRANSPORTATION PERMITS 

(a) Approved Container Sizes; Authorized Ju- 
risdictions. Local ABC Boards in the following 
counties may sell 50 milliliter, 355 milliliter, and 
375 milliliter containers ol liquor to a hotel that 
has been issued a Guest Room Cabinet Permit: 
Buncombe, Cumberland, Durham, Forsyth, 



Gaston, Guilford, Mecklenburg, Moore and 
Wake. 

(b) Purchase-Transportation Permits. A local 
board receiving an order from a guest room cab- 
inet permittee for liquor intended for resale from 
guest room cabinets shall provide a separate 
Purchase- Transportation Permit Invoice form 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1661 



PROPOSED RULES 



for the permittee in the same manner as for sales 
of liquor tor mixed beverages permittees, as 
specified in Rule .1802 of this Section. The 
Purchase-Transportation Permit Invoice shall 
contain all the information required by 4 NCAC 
2S .()3i)2ibi <M this Chapter, and in addition, shall 
show on the face of the form the permittee's 
Guest Room Cabinet Permit number. One copy 
of the Purchase-Transportation Permit Invoice 
form for guest room cabinet permittees shall be 
retained bv the local board for a period of three 
years. 

(c) Minimum Orders. A local board may re- 
quire a guest room cabinet permittee to make a 
minimum purchase of multi-bottle packages or 

sleeves" packaged by the manufacturer or 
bottler, but may not require minimum purchases 
in case quantities except as authorized by Rule 
■ 14D4 of this Subchapter. 



Statutory Authority G.S. 18B-205; 
lSB-404(d); S.L. 1991, c. 565, s. 7. 



18B-207; 



.1804 TAX STAMP PROCEDURES FOR 

GUEST ROOM CABINET PERMITTEES 

(a) A local board selling liquor for resale in 
guest room cabinets shall either affix the mixed 
beverages tax stamp to each individual container 
of liquor sold to a guest room cabinet permittee, 
or shall give the permittee one tax stamp for each 
container purchased so the permittee may affix 
the stamps to the containers so long as the un af- 
fixed stamps conform to the requirements in 
Paragraph lb) of this Rule. 

lb) A local board choosing to give unaffixed 
mixed beverages tax stamps to a guest room 
cabinet permittee shall use a stamp substantially 
different in size and color from the mixed 
beverages tax stamp used for regular mixed 
beverages sales. 

(c) bach mixed beverages tax stamp for liquor 
sold to a guest room cabinet permittee shall 
contain the same information required bv Rule 
.1901 of this Subchapter, except that the 
permittee's Guest Room Cabinet Permit number 
shall appear on the stamp in lieu <M the 
permittee s Mixed Beverages Permit number. 

id i Nothing in this Rule shall be construed to 
allow a local board to give unaffixed mixed 
K--. er.ig.-s tax --tamps to a mixed beverages 
permittee for liquor containers purchased for re- 
sale in mixed beverages. 

Statutory Authority G.S. 18B-203(a)( 1 ); 
18B-207; 18B-804(b)(9); 18B-807. 

.1805 LOCAL RULES REQUIRED FOR 
GUEST ROOM CABINET SALES 



(a) Each local board selling liquor to a hotel 
with a Guest Room Cabinet Permit shall adopt 
rules governing purchases of liquor by guest 
room cabinet permittees and shall submit those 
rules to the Commission for approval as required 
by Rule . 1 102 of this Subchapter. 

(b) Areas to be regulated shall include: 

ill 



minimum purchase requirements; 

responsibility for affixing tax stamps; 

pre-ordenng requirements; 

special orders; and 

times when sales shall be made. 



Ill 

01 

til 
111 

(c) I pon approval bv the Commission, the 
local board shall provide a copy of such rules to 
each guest room cabinet permittee, and shall 
have a copy available on the premises of the store 
from which sales will be made. 

Statutory Authority G.S. 18B-203(a)(10); 

18B-207; I8B-70K2); 18B-807. 

SECTION .1900 - SALES OF LIQUOR TO 
MIXED BEVERAGES PERMITTEES 

.1901 MIXED BEVERAGES TAX STAMP 

(a) Prior to the sale of any container of 
spirituous liquor to a permittee, the local board 
shall affix to the container a mixed beverages tax 
stamp that indicates the following: 

( 1 ) local board system of sale, 

(2) permittee's transaction number, 

(3) permittee's Mixed Beverage Permit num- 
ber. 

(b) The mixed beverages tax stamp shall be 
affixed to the original paper labeling of each 
container, except that in the case of a container 
bearing no original label the stamp shall be af- 
fixed to any conspicuous portion of the con- 
tainer. In no event may the stamp be affixed to 
the cap or closure of a container. Where a case 
of one brand has been purchased, the mixed 
beverages tax stamp shall be affixed to each con- 
tainer in the case and it shall not be sufficient to 
stamp the container el &* entire exterior of the 
case. 

(c) For sales of liquor to a guest room cabinet 
permittee, a local board may affix the mixed 
beverages tax stamp to anv portion of the con- 
tainer other than the cap or closure. In lieu of 
affixing the stamp to each container purchased 
bv a guest room cabinet permittee, a local board 
mav choose to give to the guest room cabinet 
permittee one tax stamp for each container ot 
liquor purchased for resale from a guest room 
cabinet, as authorized bv Rule .1S!I)4 of this 
Subchapter. 



1662 



6:22 IS'ORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



Statutory Authority G.S. l8B-203(a)(I); 
18B-207; 18B-804 (b)(8); 18B-807. 

.1903 LOCAL BOARD PRODUCT 
IDENTIFICATION 

Prior to the sale of any container of spirituous 
liquor to the public at retail, the local board shall 
affix to the container or the individual container's 
packaging a stamp »? label that indicates the fol- 
lowing: 

(1) local board system of sale; and 

(2) local board store number. a&4 

(4) North Carolina product code numbor. 

Statutory Authority G.S. I8B-807. 

SUBCHAPTER 2S - RETAIL BEER: WINE: 

MIXED BEVERAGES: BROWNBAGGING: 

ADVERTISING: SPECIAL PERMITS 

SECTION .0100 - DEFINITIONS: PERMIT 
APPLICATION PROCEDURES 

.0101 DEFINITIONS 

In addition to the definitions found in Sections 
18B-101 and 18B-1000 of the North Carolina 
General Statutes, the following definitions apply 
to this Subchapter: 

(1) "Employee" means any person who per- 
forms a service for any person holding a an 
ABC permit, regardless of whether that per- 
son is compensated for the performance of 
those services. 

(2) "Premises" means that building or area of 
a building plus any other property imme- 
diately adjacent to it that forms a compo- 
nent or integral part of the business for 
which the permit is issued. A diagram at- 
tached to the investigative report and kept 
in the permittee's file is prima facie evidence 
of the premises covered by that permit and 
for which the permittee and his employees 
are responsible. Permits shall authorize the 
sale and possession or consumption of alco- 
holic beverages only on the premises de- 
scribed in the investigative report and 
diagram furnished by the investigating agent. 

(3) "Original container" means a bottle, can 
or other alcoholic beverage product con- 
tainer filled by a manufacturer or bottler that 
has been approved for sale within this State. 

(4) "Private dining area" means any area of a 
restaurant or hotel that is or can be sub- 
stantially closed off from public view. 

(5) "Modified Plan Permits." as used in Rules 
.0105 and .0106 of this Section, mean on- 



premise malt beverage permits authorized 
by elections held pursuant to G.S. 
18B-602(a)(4). 



Statutory Authority G.S. 18B-207; I8B-602 (a) 
(4); 18B-1008. 

.0102 APPLICATIONS FOR PERMITS: 
GENERAL PROVISIONS 

(a) Forms. Application forms for all ABC 
permits may be obtained from the North 
Carolina Alcoholic Beverage Control Commis- 
sion at the following address, or by telephoning 
the Commission between 8:00 a.m. and 5:00 
p.m., Monday through Friday: 

North Carolina ABC Commission 

3322 Garner Road 

P.O. Box 26687 

Raleigh, North Carolina 27611-6687 

(b) Statutory Requirements. Before the issu- 
ance of any ABC permit, an applicant shall 
comply with the statutory requirements of Arti- 
cles 9 and 10 of Chapter 18B of the General 
Statutes and with the rules of the Commission. 

(c) Separate Permits Required. An applicant 
operating separate buildings or structures not 
connected directly with each other or businesses 
with separate trade names shall obtain and hold 
separate permits for each building or business for 
which he wants permits, and he shall pay the 
appropriate application fees as provided in G.S. 
18B-902(d). Where there are multiple buildings, 
and the Commission determines that the business 
is operated as one entity, the Commission may, 
in its discretion, issue one permit. 

(d) Information Required on Application. An 
applicant for any ABC permit shall file a written 
application with the Commission and in the ap- 
plication shall state, under oath, the following 
information: 

(1) name and address of applicant; 

(2) corporate or partnership name; 

(3) mailing address e£ and location address of 

business for which permit is desired, and 
county in which business is located; 
trade name of business; 
name and address of owner of premises; 
applicant's date and place of birth; 
if a corporation, the name and address of 
agent or employee authorized to serve as 
process agent (person upon whom legal 
service of Commission notices or orders 
can be made); 

if a non-resident, name and address of 
person appointed as attorney-in-fact by 
virtue of duly executed and registered 
power of attorney; and 
(9) a detailed diagram of the premises show- 
ing: 

(A) entrances and exits; 

(B) storage area for alcoholic beverages; 



(4) 
(5) 
(6) 

(7) 



(N) 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1663 



PROPOSED RULES 



(C) locations where alcoholic beverages 
may be served or consumed. 
In addition, an applicant shall state, under oath, 
that he is the actual and bona fide owner or lessee 
of the premises for which a permit is sought and 
shall submit a copy or memorandum of the lease 
showing the applicant as tenant, or a copy of the 
deed showing the applicant as the grantee or 
owner; that he intends to carry on the business 
authorized by the permit himself or under his 
immediate supervision and direction; and that he 
is an actual and bona fide resident of the State 
of North Carolina or, as a non-resident, has ap- 
pointed, by virtue of a duly executed and regis- 
tered power of attorney, a resident manager to 
serve as attorney-in-fact who will manage the 
business and accept service of process and official 
Commission notices or orders. 

(e) General Restriction; Living Quarters. No 
permit for the possession, sale or consumption 
of alcoholic beverages shall be issued to any es- 
tablishment when there are living quarters con- 
nected directly thereto, and no permittee shall 
establish or maintain living quarters in or con- 
nected to his licensed premises. 

(f) General Restriction; Restrooms. No permit 
for the on-premises possession, sale, or con- 
sumption of alcoholic beverages shall be issued 
to any establishment unless there are two 
restrooms in working order on the premises. 
This requirement may be waived for good cause 
shown. 

(g) Areas for Sales and Consumption. In de- 
termining the areas in which alcoholic beverages 
may be sold and consumed, the Commission will 
consider the convenience of the permittee and his 
patrons, allowing the fullest use of the premises 
consistent with proper control, but will attempt 
to avoid consumption in areas open to the gen- 
eral public other than patrons. 

(h) Temporary' Permits for Continuation of 
Business. In its discretion the Commission may 
issue temporary 7 permits to an applicant for the 
continuation of a business operation that holds 
current ABC permits when a change in owner- 
ship or location of a business has occurred. To 
obtain a temporary permit an applicant shall 
submit the appropriate ABC permit application 
form, all required fees, a lease or other proof of 
legal ownership or possession of the property on 
which the business is to be operated, and a writ- 
ten statement from the ALE agent in that area 
stating that there are no pending ABC violations 
against the business. An applicant for a tempo- 
ran" permit should also submit the permits of 
the prior permittee for cancellation prior to the 
issuance of any temporary permit. No tempo- 
ran" permit shall be issued to any applicant unless 



all prior ABC permits issued for the premises 
have been cancelled by the Commission. 

(i) Retail Sales at Public Places Restricted. 
The sale and delivery of alcoholic beverages by 
licensed retail outlets located on fair grounds, golf 
courses, ball parks, race tracks, and other similar 
public places are restricted to an enclosed estab- 
lishment in a designated place that has been ap- 
proved by the Commission. No alcoholic 
beverages, shall be sold, served, or delivered by 
these outlets outside the enclosed establishment, 
nor in grandstands, stadiums or bleachers at 
public gatherings. 

As used in this Rule, the term "enclosed estab- 
lishment" shall include a temporary structure or 
structures constructed and used for the purpose 
of dispensing food and beverages at special events 
to be held on fairgrounds, golf courses, ball 
parks, race tracks, and other similar places. 

Sales of alcoholic beverages may be made in 
seating areas such as box seats only under the 
following conditions: 

( 1 ) table senice of food and non-alcoholic 
beverages are available to patrons in box 
seats; 
no alcoholic beverages are delivered to the 



Gl 



01 



box seats area untd after orders have been 
taken; and 

box seat areas have been designated as part 
of the permittee's premises on a diagram 
submitted by the permittee, and the 
Commission has granted written approval 
of alcoholic beverage sales in these seating 



(j) Separate Locations at Airport. If one 
permittee has more than one location at the ter- 
minal of an airport boarding at least 150,000 
passengers annually and that permittee leases 
space from the airport authority, the Commis- 
sion recognizes that allocation of space is con- 
trolled bv the airport authority. Therefore, the 
permittee in such a situation may: 

( 1 ) obtain a single permit for all its locations 
in the terminal; 

(2) use one central facility for storing the al- 
coholic beverages it sells at its locations: 
and 

(3) pool the gross receipts from all its lo- 
cations for determining whether it meets 
the requirements of G.S. 1 SB- 1000(6) and 
Rule .0519 of this Subchapter. 

(k) food Businesses. Lnless the business 
othenvise qualifies as a wine shop primarily en- 
gaged in selling wines for off-premise consump- 
tion, a food business will qualify for an 
off-premise fortified wine permit only if it has 
and maintains an inventon of staple foods worth 
at least one thousand five hundred dollars 



1664 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



($1,500) at retail value. Staple foods shall include 
meat, poultry, fish, bread, cereals, vegetables, 
fruits, vegetable and fruit juices and dairy pro- 
ducts. Staple foods do not include coffee, tea, 
cocoa, soft drinks, candy, condiments and spices. 

Statutory Authority G.S. 18B-207; I8B-900; 
18B-901(d); 18B-902; I8B-903; 18B-905; 
18B-I000(3); I8B-1008. 

.0103 CORPORATIONS HOLDING PERMITS 

(a) Filing Applications. ¥he managor ef ovory 
corporation applying fof ef holding any ABC 
pormit, except fof corporations holding only e£f- 
promiso malt beverage, unfortifiod wine ef forti 
See 1 wino permits, shall file foe appropriate 
application with- the Commission af>4 qualify 
under foe provisions ef G.S. 18B 900. 

fo) Corporations With Off Premise Pormito 
Only. Corporations applying fof ef holding only 
off promise permits fof foe sale ef malt bovoragoo 

^^T ^^^^^^^7 ^^^Tt^^T t^^^^^v ^^^T ^T^^7 ^^^^^^^^CT^^^^^y ^^T ^^^^7 ^T^^^^^j 

afea as foe posted ABC permits, foe foil name, 
hom e address atfo phono number ef foe curront 
managor ef foe ostablishmont. 

(e) Changos fo Management; Now Managers. 
Whonovor foe managor ef- a corporation othor 
than a corporation holding only off premise malt 
beverag e an4 wine permits chang e s, foe Hew 
manager shall file application with foe Commie 
oion, submit a fee ef tea dollars ($10.00), ae4 
quality undor foe provisions ef G.S. 18B 900 
within 34 days ef bis employment. 

(4) Transferred Managers. When a person who 

1 IUJ DTI! F HJUJI T rTTCTT tXL.' I ' U VUl IT Tl I UI Id U V1U11I IVTJ TTTTTT 

foe Commission is subsequently transferred by a 
corporate pormittoo foat- holds on premiso ef 
brownbaggjng permits te- a different lioonood le- 
cation operated by foe same corporation, he is 
ae+ required te- file a» additional application. 
He shall, however, notify foe Commission fo 
writing ef foe transfer an4 foe new location s a4- 
dress, including foe pormit numbers ef curront 

rTTTT? r ' 1 1 III J nTra CTT COT rT^TTTT oTICTTSrTOW n^fTTPTTTTTT 

Any corporation holding an ABC permit in this 
State that seeks permits for any additional busi- 
ness location shall have the manager of the new 
location tile the appropriate application and fee, 
and qualify under G.S. 18B-QQ0(a). 

Statutory Authority G.S. 18B-207; 18B-900; 
18B-902(a); 18B-903(d). 

.0105 SPECIAL REQUIREMENTS FOR 
RESTAURANTS 

(a) Requirements to Qualify for Brovvnbagging, 
on-premise Fortified Wine. Mixed Beverages, or 
Modified Plan Permits. To qualify as a restaurant 



for a Brownbagging, on-premise Fortified Wine 
or Mixed Beverages Permit, or a Malt Beverages 
Permit in areas approving on-premise malt 
beverages under G.S. 18B-602(a)(4), a business 
shall have an inside dining area set aside for the 
service of meals that contains table seating for at 
least 36 persons. N© table less than : ?4Q square 
inches ef surface afea shall be considered fo 4e- 
tormining whether a restaurant has table seating 
fof 46? Food shall be available at all times that 
alcoholic beverages are being served. 

fo) Loungos. A restaurant f»ay alse include 
a» adjacent lounge, which is a spaco soparato 

II \J III 111U OO LUIC CoXTT UI IU TT I IH_'l 1 ^T 1 1 U.A \J U CT L'UllLl lll/IT 

lcitchon wifo foe dining area. 4foe adjacont 

1UUI *K" IIL"l_"U rtTTT fcTTTTTCOTT J'J C^U I Tl ITT 1 1 DCIT UT PTTT^ 

foil moals as le«g as food is availabl e fo foe 
lounge while alcoholic beverages a*e befog 
served. 

(b) fo) Typical Characteristics. Although a fa- 
cility need not possess all of the following char- 
acteristics to qualify as a restaurant, each is 
typical of a bona fide restaurant and the Com- 
mission may consider the extent to which a fa- 
cility possesses these characteristics in deciding 
whether to issue, suspend, or revoke the permits 
listed in Paragraph (a): 

(1) The facility has a printed menu listing full 
meals with substantial entrees; 

(2) The facility has complete cooking and re- 
frigeration equipment; 

(3) The greatest portion of the food sold is 
prepared in the facility's own kitchen and 
prepackaged food is only an incidental 
part of the sales; 

(4) The greatest portion of the food sold is 
consumed on the premises; 

(5) There are separate kitchen and service 
staffs; 

(6) Seating for dining customers is primarily 
at tables; a»4 

(7) Only a small portion of the premises is 
devoted to activities unrelated to the ser- 
vice and consumption of food; and 

(8) Sales of food are significantly greater than 
sales of nonalcoholic beverages, especially 
nonalcoholic beverages sold as "set-ups." 

(c) (4) Requirements for Application. For a 
restaurant to obtain a permit listed in Paragraph 
(a), the applicant shall submit to the Commis- 
sion the appropriate application fee and the fol- 
lowing documents: 

(1) a completed application on a form pro- 
vided by the Commission, which shall in- 
clude the full names and addresses of all 
owners, officers, directors, shareholders 
owning 25 percent or more of the stock, 
and the manager; if, however, a corpo- 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1665 



PROPOSED RULES 



ration holds any other ABC permit, ap- 
plication by the manager shall be 
sufficient; 

(2) a copy of the restaurant's menu or list of 
food served; 

(3) photographs (black em4 whito ©f color) 
measuring ne small e r than five inches by 
seven inchoo ef the following: of sufficient 
detail to show the following: 

(A) entire kitchen, including all equipment; 

(B) all dining areas, showing seating ar- 
rangements, including patios or outdoor 
areas where alcoholic beverages may be 
sold or consumed; 

(C) bars, counters, mixing stations; 

(D) locked storage area or areas for storage 
of alcoholic beverages; 

(E) front exterior of premises or if estab- 
lishment is located in an office building, 
mall or other larger structure, the main 
entrance. 

(4} a financial statement, e» a form providod 
by the Commission, f-e* eaeh ef the ppe- 
coding s» months, ©* fi»F each month ef 
operation ef the r e staurant if less tha» st* 
months, showing: gross receipts from the 
sale ef food af*4 non intoxicating 
beverages; gross receipts from the sale »f 
malt beverages a**4 v . mo, if aayt and gross 
receipts from the sale ef aH oth e r items. 
tf a» applicant has net previously boon i» 
operation, a projected financial statement 
estimating gross receipts fw food an4 
beverage items shall be files e» a form 
provided by the Commission. 

Statutory Authority G.S. 18B-207; 18B-900; 
18B-901; I8B-902; /SB-/ 000(6); I8B-1008. 

.0106 SPECIAL REQUIREMENTS FOR 
HOTELS 

(a) Requirements to Qualify for Brownbagging, 
on-premise Fortified Wine, Mixed Beverages, or 
Modified Plan Permits. To qualify as a hotel for 
a Brownbagging or a Mixed Beverages Permit, 
or a Malt Beverage Permit in areas approving 
on-premise malt beverages under G.S. 
18B-602(a)(4), an establishment shall have on or 
closely associated with its premises a full-service 
restaurant providing at least 36 seats, at tables. 
The restaurant may or may not be owned by the 
same person who owns the hotel. If the restau- 
rant is owned by a person different from the 
owner of the hotel, permits shall be not be issued 
to the restaurant unless it qualifies under Rule 
.0105 of this Section. 

(b) For a hotel with a restaurant to obtain one 
of the permits listed in Paragraph (a), the appli- 



cant shall submit to the Commission, the appro- 
priate application fee and the following 
documents: 

(1) a completed application on a form pro- 
vided by the Commission, which shall in- 
clude the full names and addresses of all 
owners, officers, directors, shareholders 
owning 25 percent or more of the stock, 
and the manager; if, however, a corpo- 
ration holds any other ABC permit, ap- 
plication by the manager is sufficient; 

(2) a copy of the restaurant's menu or a list 
of food served; 

(3) photographs (black a«4 white &f color) 
m e asuring He smaller than five inches by 
seven inches ef the following: of sufficient 
detail to show the following: 

(A) entire kitchen including all equipment; 

(B) all permanent dining areas, showing 
seating arrangements, including patio or 
outdoor areas where alcoholic beverages 
might be served or consumed; 

(C) bars, counters and mixing stations; 

(D) locked storage area or areas; and 

(E) front exterior of premis e s; hotel and 
restaurant. 

(4) a financial statomont, ©» a form provided 
by the Commission, fi>F each »f the p?e- 
coding s«* months, e* f-ef oaoh month ef 
operation ef the hotol if it is less than em 
months, showing the following: gross re- 
ceipts from the furnishing ef lodging; 

j£^^ ^^^^^^^^^^^^ y-^m ^^^^^^ ^^1 r . ■ . . j ^^^^^i ^^^^^^^^ 
5^^^^^^ r^^TTpT? 1 1 T./1 1 1 JUIU KJ1 \\J\J\J HI 1U IH_FII 

alcoholic bovoragos; gross receipts from 

vTT^ LTU. 1 U \TT II RD C ^^^TTTIC^^ CTT^^T TT H^TT TT CTTtTt 

afi4 gross receipts from the sale ef all 
other items, If- a» applicant has Bet p*e- 
viously been » operation, a projected fi- 
nancial statomont estimating gross receipts 
fef the food, lodging <&*& beverage items 
shall be filed- e» a form providod by the 
Commission. 
(c) Locations Where Sales Permitted. 

Brownbagging by patrons, consumption of alco- 
holic beverages and sales of mixed beverages are 
allowed at any time during lawful hours in the 
restaurant and in any lounge or other place that 
is customarily open to the general public and that 
is associated with the restaurant. These lounges 
and other places need not be directly connected 
to the restaurant as long as the services of the 
restaurant are available to the lounge at all times 
that alcoholic beverages are being served. Sales 
and consumption of mixed beverages are allowed 
in banquet rooms, convention rooms, suites and 
similar places not usually open to the general 
public only during scheduled events and only to 
persons attending those events. Portable bars 



1666 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



may be used for the sale or mixing of mixed 
beverages in those rooms. 

(d) Diagram of Premises. The diagram of the 
premises submitted with the application for a 
permit under this Rule and the diagram approved 
by the Commission when the permit is issued 
shall be marked to indicate which spaces are 
considered part of the restaurant and lounge or 
other places associated with the restaurant and 
customarily open to the general public, and 
which spaces are considered banquet rooms, 
convention rooms, meeting rooms, suites, and 
similar places where mixed beverages are to be 
sold only during scheduled events. 

(e) Managers' Receptions. Hotels operating 
lodging, restaurant and lounge facilities under 
one set of ABC permits may offer lodging guests 
up to two alcoholic beverages per guest per day 
in the price of the room package under the fol- 
lowing conditions: 

( 1 ) The reception or social hour is held on the 
licensed premises of the hotel; 

(2) The hotel issues a voucher for the 
beverages that can be used by the guest to 
obtain the beverage of his choice; 

(3) Nonalcoholic beverages shall also be of- 
fered to lodging guests during the func- 
tion; and 

(4) The hotel must account for the beverages 
bv an internal accounting procedure to 
insure that the price of each beverage in- 
cluded in the room rate package is the 
same price as is being charged other pa- 
trons in the lounge or restaurant for the 
same beverage. This procedure must be 
acceptable to tjie Commission's Audit 
Division. 

(f) Guest Room Cabinet Permits; Application 
Requirements. .Applications for a Guest Room 
Cabinet permit will be accepted only from hotels 
with Mixed Beverages permits, or from hotels 
simultaneously applying for Mixed Beverages 
permits, in the following counties: Buncombe, 
Cumberland. Durham. Forsvth, Gaston. 
Guilford. Mecklenburg, Moore and Wake. 

In addition to the general requirements for per- 
mit applications in this Rule and in Rule .0KJ2 
of this Section, a hotel applying for a Guest 
Room Cabinet permit shall submit the following 
items along with the completed application form 
and appropriate fee: 



ill 

Ql 

L2U 



list of lodging rooms bv room number in 
which cabinets will be placed; 
Total number of lodging rooms and total 
number of rooms set aside that will not 
have a cabinet: 



Description of cabinets to be installed bv 
the hotel. A manufacturer's brochure de- 



scribing the cabinet will be sufficient, or 
the permittee may submit photographs 
and a written description of the lock used 
on the cabinet; 
(4) Written policies developed by the 
permittee regarding the procedures that 
will be implemented bv the hotel to: 

(A) insure no one under 21 is able to obtain 
a key to the cabinet; 

(B) control inventory; 

(C) insure price lists for items sold from 
cabinets are easily readable; 

(D) dispose of all opened alcoholic beverage 
containers sold from cabinets after guest 
has checked out; 

(E) maintain adequate numbers of ice and 
soft drink vending machines elsewhere on 
the premises. 

Statutory Authority G.S. 18B-207; 18B-900; 
ISB-90I; 1SB-902; 18B-1000(4); 18B-I00I ( 12); 
18B-1008; S.L. 1991, c. 565, s. 7. 

.0107 SPECIAL REQUIREMENTS FOR 
PRIVATE CLUBS 

(a) Definition. A private club is a private fa- 
cility organized and operated by a person, asso- 
ciation or corporation solely for a social, 
recreational, patriotic or fraternal purpose. Use 
of the facility shall not be open to the general 
public but shall be limited to members of the 
private club and their guests. 

(b) Typical Characteristics. Although a facility 
need not possess all of the following character- 
istics to qualify as a private club, each is typical 
of a bona fide club and the Commission will 
consider the extent to which a facility possesses 
these characteristics in deciding whether to issue, 
suspend, or revoke a Brownbagging, Fortified 
Wine or Mixed Beverages Permit: 

(1) Membership is subject to clearly stated 
requirements that tend to show a com- 
mon bond among members; 

(2) Some limit related to the size of the fa- 
cility is placed on total membership; 

(3) All members may and do participate in 
its organizational affairs, including the se- 
lection of officers or directors at reason- 
ably frequent intervals; 

(4) The club operates pursuant to a charter, 
articles of association, constitution, or 
similar basic document and has adopted 
by-laws, copies of which are provided to 
each member; 

(5) The club has clearly stated objectives of 
a social, recreational, patriotic or fraternal 
nature and its activities advance those ob- 
jectives; 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1667 



PROPOSED RULES 



(6) Membership entitles a person to signif- 
icant privileges other than the consump- 
tion of alcoholic beverages; 

f?) Initiation as4 membership foes are sub 
stantially gr e at e r than what would be paid 
by- a ono timo »f caoual «s»f ef- the facih 

(7) (g) Most members hold full rather than 
limited memberships; 

(£) Initiation »f membership feesr as distin 
guish e d from admission foesy afe used t» 
mitigato significantly operating ojtponooQ; 

(8) (4% Facilities and activities other than 
those customarily related to the con- 
sumption of alcoholic beverages are avail- 
able to members; 

(9) (444 Some limits are placed on the number 
of times a guest may use the facilities; 

( 10) f42} Guests constitute a relatively small 
portion of the users of the facility, 
(c) Mandatory Requirements. To qualify as a 
private club, a facility shall meet the following 
requirements concerning membership: 

( 1 ) collect an annual membership fee separate 
from any admission or cover charge, no 
dues from which may be more than 30 
days past due; 

(2) maintain a written policy on the granting 
of full and limited memberships; 

(3) require each prospective member to 
complete a written application that con- 
tains questions directly related to the ap- 
plicant's interest in the social, patriotic, 
fraternal or recreational purpose of the 
club, the applicant's qualifications for 
membership, and the applicant's back- 
ground; 

(4) retain each completed application, if ap- 
proved, in the organization's permanent 
records as long as the individual's mem- 
bership continues; 

(4) havo a membership committee) ef at l e ast 
throe persons v4>» review aH applications 
fo* membership a«4 make rocomm e n 
dations t» the foil membership; 

(5) (4) grant no membership sooner than 
three days after receipt of application; 

(6) (?) issue written or printed evidence of 
membership to each member, which evi- 
dence of membership or other reasonably 
reliable document of identification shall 
be in the possession of each member 
present on the licensed premises; 

(7) (&)• maintain on the premises a current al- 
phabetical roster of all members and their 
complete addresses; 



(8) fty maintain and provide to each member 
a written policy concerning the use of fa- 
culties by guests, 
(d) Permit Application Procedures. For a pri- 
vate club to obtain a Brownbagging or a Mixed 
Beverages Permit, the applicant shall submit to 
the Commission the appropriate application fee 
and the following documents: 

(1) a completed application on a form pro- 
vided by the Commission, which shall in- 
clude the full names and addresses of all 
officers and directors (including those 
chosen by the membership), and the 
manager; a»4 the members ef- the com 
mitt ee who review applications fof mom 
borships; 

(2) the written policy on granting of full and 
limited memberships; 

(3) a copy of the membership application 
form; 

(4) a copy of the membership card or certif- 
icate to be issued to members; 

(5) the written policy on use of facilities by 
guests; and 

(6) the charter, articles of incorporation, 
constitution, or other basic documents, 
and the by-laws, if any. 

Statutory Authority G.S. 18B-207; 18B-900; 
18B-901; 18B-902; 18B-1000(5); 1 SB- 1008. 

.0108 ILLEGAL LSE OF PERMITS: CHANGE 
OF OWNERSHIP OR NAME 

(a) No permittee shall allow any other person 
to use his permit to operate the licensed premises 
after disposing of his financial interest in the li- 
censed premises. 

(b) A permittee shall not pay any profits de- 
rived from the operation of the licensed business 
to any person who neither owns a financial in- 
terest in the business nor performs a service for 
the business. This restriction shall not, however, 
prohibit a permittee from entering into a lease 
by which the landlord is entitled to a percentage 
of receipts in lieu of or in addition to a periodic 
rent payment. 

(c) Change in Ownership. A permit shall au- 
tomatically terminated terminate whenever any 
change in the ownership of the business, as pro- 
vided in G.S. 18B-903(c) occurs. Permits issued 
for a business in which a change of ownership 
has occurred shall be returned to the Commis- 
sion or delivered to the State ALE Agent agent 
assigned to the area. 

(d) Change in Name. When the permittee's 
name or name of business is changed, the 
permittee shall apply to the Commission for du- 



1668 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



plicate permits in accordance with G.S. 
18B-903(g). 

Statutory Authority G.S. 1SB-207; l8B-901(c); 
18B-903(c); 18B-903(g). 

SECTION .0200 - GENERAL RLLES AFFECTING 

RETAILERS AND BROWNBAGGING 

PERMITTEES 

.0202 CLEARING TABLES/COUNTERS; 

IIOLRS FOR POSSESSION/REMOVAL 

I r-\ \ V. •-> 1 . 1 I Jr/-\ \-\ i l--i i ♦ f-> . -T I liinnn 1 . \ «-t fun I Inn re- \' j-t 

rrrr ltuiu i ivmiii'ii \.\x 1 ~ ui 11 1 c i^vi iuii 1 i iuui j. i t t_r 

alcoholic bov e ragos may fee s©14 between the 
hours ©£4-h0© a.m. aft© : ?44§ a.m. 

(a) (fe) Clearing Beverages Off Tables and 
Counters. All tables and counters shall be 
cleared of all alcoholic beverages, bottles, cans, 
glasses and containers by 4-^© 2:30 a.m. No 
permittee or his employees shall allow a patron 
to possess a container of alcoholic beverages after 
2:30 a.m. 

(e) Exception. During the period commencing 
©» the last- Sunday ©f April ©f each year, aft© 
ending ©ft the last- Sunday ©f- October ©f- each 
y e ar, alcoholic beverages f»ay- he s©W until 34M4 
a.m., a«4 ali tables a«4 counters shall fee cleared 

l-«i r } ■ i II -i m 
O f ETTTTT CT7TTTT 

(4) Sunday Sales. 



: Fhe sale ©f alcoholic 



^^^TC^^T ^^^^T ^^^^^^^^^^^ t^^^^^PT ^^^^^^ ^^^^^^^ rTTT 117 I V 

Sunday. 

(b) f©} Removal From Premises. No alcoholic 
beverages may be removed from any retail li- 
censed premises whenever the sale of alcoholic 
beverages is prohibited by law. 

Statutory Authority G.S. 18B-207; I8B-1004. 

.0205 EMPLOYEE AGE REQUIREMENT 

(a) Age Requirement: Brownbagging, Mixed 
Beverages and Special Occasions Permits. Per- 
sons holding Brownbagging. Mixed Beverages or 
Special Occasions Permits shall have an em- 
ployee who is at least 21 years of age in charge 
of the licensed premises at all times. 

(b) Age Requirement: Malt Beverage, Unforti- 
fied Wine and Fortified Wine Permits. Persons 
holding retail Malt Beverage, Unfortified Wine, 
or Fortified Wine Permits shall have an employee 
who is at least 18 years old in charge of the li- 
censed premises at all times. 

(c) Bartenders: Brownbagging, Mixed 
Beverages and Special Occasions Permits. No 
person under the age of 21 may be employed by 
any permittee to mix drinks containing spirituous 
liquors, liquor. 

(d) Waiters and Waitresses. -?v© person under 
the age ©f 4-8- m&f fee employed fey a©y permitte e 
ift connection witfe the preparation, serving, sale 



©f delivery ©f- alcoholic boveragos at- a»y ostab 

D .'nil ten i i it. j mmE i tvt i 1 n it* itji ctxv K7I1 i_ti vi rRTun trvii \j 

©f consumption ©f- alcoholic beverages. Ages of 
persons employed in the preparation, serving, 
sale or delivery of alcoholic beverages at any es- 
tablishment holding permits for the on-prcmise 
sale or consumption of alcoholic beverages are 
governed by the provision of The Wage and 
flour Act, Article 2A of Chapter 95 of the N.C. 
General Statutes. 

(e) Other Employees: This Rule does not pro- 
hibit the employment of a minor by a permittee 
if the minor does not prepare, serve, seU, or de- 
liver any alcoholic beverages, and if the employ- 
ment is otherwise lawful under the Wage and 
flour Act. 

(f) Off- Premise Permits. This Rule does not 
prohibit the employment of minors at an estab- 
lishment holding only off-premise permits for the 
retail sale of malt beverages or wine. 

(g) Topless Minors. No permittee may employ 
or allow any female under the age of 18 to per- 
form any service if the minor exposes to public 
view or wears transparent clothing that reveals 
the nipple or any portion of the areola of the 
breast. 



Statutory Authority G.S. 
95-25.5 (a), (j); 95-25.14. 



J8B-207; 18B-900; 



.0218 COIN VENDING MACHINES TO 

DISPENSE BEVERAGES PROHIBITED 

(a) No permittee or his employee shall use or 
permit the use of any automatically operated or 
coin vending machines for dispensing alcoholic 
beverages. 

(b) In-room bars or cabinets from which alco- 
holic beverages are dispensed, that arc placed in 
the lodging rooms of a guest room cabinet 
permittee, shall not be considered automatically 
operated vending machines. 

Statutory Authority G.S. 18B-207; 18B-100! (12). 

.0220 TRADE NAME SIGNS 

Within 60 days of receipt of his permanent per- 
mit, a permittee shall have at least one sign on 
the exterior of his premises that states the trade 
name of his premises as it appears on his permit. 
The sign shall be maintained on the exterior of 
the premises at all times. 

Statutory Authority G.S. 1 8 B- 207. 

.0221 MAXIMUM QUANTITIES ALLOWED TO 
BE SOLD 

fa} Malt Beverages. N© r e tail malt beverage 
permittee, ©f his employee shall s©44 ©f deliver t© 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1669 



PROPOSED RULES 



LU I T L' i I \» rTTTTTT CTC HI T T CTW rHTTv rTTTTT^ 1 1 ECQ I ^^^ IX 

^^^^^ ^^^^£ L^^^^^T^^^^^^fc l^^i Q^^^^C^ ^^^1 i^^#^^^ ^^^^^^^1 ^^1 

rCI J I I VJ I I- AlU r 1 pR , rT^T ^r^^TT^ I T IUI I TEH It t-TT 3Q3 (_TI 

12 ounc e ease g4«* H«e 12 ounce cans, ef seven 
cases e£ 16 ounco cans pk*§ ©fte 16 ounco can) 
e£ malt beverages other than draught bee? i» 

(-bt Wines. rVe retail fortified ©f unfortifiod 
wine permittee e* bis employee oholl sett &f de- 

rTTTT TTT HI 1 T l_T 1 1L Y 3v1 ™ U. I HI I ? ORD IU11~ I11U1U 

than 30 liters »f unfortifiod wine e* more than 
fo«f liters ©f- fortified wino, exc e pt as authorized 
by a purchase transportation permit. 

Statutory Authority G.S. 18B-207; 1SB-303. 

mil CONTAINER SIZES 

Fortified wine may be sold in any original con- 
tainer that holds up to fo«f five liters, and un- 
fortified wine may be sold in any original 
container that holds up to ^Q 20 liters. AU wino 
containers shall be e>£ glass e* other nonmotallio 
materials, e xcept fo* bulk containers approved 
by tbe commission. 

Statutory Authority G.S. 18B-206; I8B-207. 

.0229 DESTRUCTION OF L'NCONSL'MED 
BEVERAGES 

Any alcoholic beverages served to a customer 
that he does not completely consume and that 
he leaves shall be destroyed immediately, except 
that a hotel guest cabinet permittee shall not be 
required to dispose of opened containers of alco- 
holic beverages sold from an rn-room bar or 
cabinet until after the lodging guest has checked 
out of the hotel. 



Statutory Authority G.S. 18B-206; I8B-207. 

.0232 HAPPY HOURS REGELATED 

(a) .An on-premise permittee or his agent shall 
not: 

( 1) sell more than one drink to a patron for a 
single price; 

(2) establish a single price based upon the re- 
quired purchase of more than one drink; 
or 

(3) deliver more than one drink at one time 
to a patron for his consumption. 

This Rule does not prohibit the sale of pitchers 
of alcoholic beverages to two or more patrons, if 
not otherwise inconsistent with the ABC law. 
This Rule also does not prohibit serving a single 
carafe or bottle of wine to a single patron. 

(b) An on-premise permittee or his agent shall 
not give away a drink or sell one at a price that 
is reduced different from the usual or established 
price charged for the drink for any period of time 



less than one full business day. Free or reduced 
drinks under this provision shall be offered to all 
customers, not just a segment of the population, 
(cj For purposes of this Rule, a "drink" con- 
tains the amount of alcoholic beverages usually 
and customarily served to a single patron as a 
single serving by the permittee. 

(d) Exception for Certain Holidays. An on- 
premise permittee may include alcoholic 
beverages in a package offering that includes a 
meal or entertainment if the offered special is 
made in conjunction with the following holidays: 
New Year's, Valentines Day, Mothers Dav. or 
Father's Dav. 

(e) The offer of a meal and alcoholic beverage 
at a single total price is not a violation of this 
Section so long as the total price reflects the ac- 
tual price of the alcoholic beverages and not a 
reduced price. 

Statutory Authority G.S. 18B-207. 

.0233 CONSUMPTION BY UNDERAGE 
PERSONS 

(a) Consumption bv Persons Under Age. No 
permittee or his employees shall knowingly allow 7 
a person under the age of 21_ to possess or con- 
sume anv alcoholic beverages on the licensed 
premises. 

(b) Identification. It shall be the dutv of the 
permittee and his employees to determine the age 
of any person consuming or possessing alcoholic 
beverages on the licensed premises. Acceptable 
identification for purposes of deterniining age 
shall be a driver's license, a special identification 
card issued by the North Carolina Division of 
Motor Vehicles, a military identification card, or 
a passport. 



Statutory Authority G.S. 
18B-1005 (a) (1). 



1SB-207: J8B-302; 



.0234 PRIVATE CLUBS: GENERAL 
PROHIBITIONS; GUESTS 

(a) Neither a private club permittee nor his 
employee shall: 

( 1 ) allow any person who is not a member 
or a bona tide guest of a member to be 
present as a patron on the premises of a 
private club: or 
(2) grant membership to the private club to 
anv person earlier than three davs from 
the receipt of his application for member- 
ship. 
(bl "House Guests. No private club 
permittee or his employee shall admit patrons as 
"house" guests. 



76~0 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



(c) Employee Member. An employee who is 
also a member of the private club shall not admit 
a patron as his guest while that employee is on 
duty. 

(d) A member shall designate his own guest. 
If a member accepts a patron as his guest at the 
behest of the private club mixed beverages 
permittee or employee, then the Commission 
shall consider that member to be acting as the 
permittee's agent . 

Statutory Authority G.S. 18B-207; 18B-1008. 

.0235 PRIVATE CLUBS; RECIPROCAL 
MEMBERSHIPS 

A private club permittee may offer reciprocal 
memberships to bona fide members of other pri- 
vate clubs under the following conditions: 

(1) Reciprocity may extend only to members 
of private clubs holding Mixed Beverages or 
Brownbagging permits issued by the Com- 
mission. 

(2) All clubs participating in reciprocal mem- 
bership arrangements shall enter into a writ- 
ten agreement setting forth the terms of their 
arrangement, and each club shall adopt rules 
governing the use of their facilities by recip- 
rocal members. The agreement and rules 
shall be filed with the Commission and 
made a part of the permittees' files. 

(3) Private clubs entering into such agreements 
shall be located in d liferent counties. 

(4) A member of another club who is granted 
a reciprocal membership shall be required to 
show a valid membership card indicating he 
is a bona fide member of the reciprocal club 
each time he enters the facility. 

Statutory Authority G.S. 18B-207; 1 SB- 1008. 

.0236 TRANSFER OF PRODUCTS BETWEEN 
PREMISES PROHIBITED 

A permittee owning more than one licensed re- 
tail establishment shall not transfer alcoholic 
beverages from one business location to another 
except upon written request to and approval by 
the Commission. No approval for such transfer 
given except upon a showing by 
the following: 



the 



will be 
permittee ot 

( 1) the establishment from which the alcoholic 
beverages are to be removed is going out of 
business or closing for such a period of time 
that the alcoholic beverages will spoil or de- 
teriorate before the business reopens; or 

(2) the wholesaler assigned to the establishment 
to which the products will be transferred is 
unable or unwilling to supply the products. 



This Rule shall not be construed to authorize a 
retail permittee to make purchases at a central 
location or warehouse for distnbution to other 
retail establishments owned by the permittee. 

Statutory Authority G.S. 18B-207; 18B- 1006(h); 
18B-1007(a). 

SECTION .0400 - ADDITIONAL 

REQUIREMENTS FOR BROWNBAGGING 

PERMITTEES 

.0402 PRIVATE CLUBS: POSSESSION OF 
ALCOHOLIC BEVERAGES 

(a) Quantity. No private club brownbagging 
permittee shall allow a member or .guest of the 
club to possess more than few five liters of 
spirituous liquors liquor or few five liters of for- 
tified wine, or fo«f five liters of the two com- 
bined; more than 80 liters of malt beverages (nine 
cases of 12 ounc e 355 milliliter cans plus nine 
12 ounc e 355 milliliter cans, or seven cases of 
16 ounce 473 milliliter cans plus one 16 ounco 
473 milliliter can); or more than 20 liters of un- 
fortified wine upon the premises. 

(b) Label Required. A permittee shall ensure 
that each container brought onto the premises is 
labeled immediately with the member's name 
substantially as it appears on the membership 
roster and that containers brought by guests are 
labeled with the names of the guest and the 
sponsoring member. 

(c) Possession by Permittee Not Holding 
Mixed Beverages Permit. A permittee not hold- 
ing a Mixed Beverages Permit or his employee 
may maintain custody over a member's or guest's 
alcoholic beverages and locker key provided that 
during custody, the member or guest is present 
on the premises. The member's or guest's alco- 
holic beverages shall be used exclusively by the 
member and his bona fide guests, and the alco- 
holic beverage containers and locker key shall be 
returned to the member or guest before he leaves 
the premises. 

(d) Furnishing Alcoholic Beverages Limited. 
Neither the permittee nor a member shall furnish 
or have furnished alcoholic beverages to other 
members or bona fide guests of members unless 
the member owning the beverages is physically 
present upon the premises. 

Statutory Author itv G.S. 18B-207; 18B-100J(7); 
18B- 1006(b). 

.0403 PRIVATE CLUBS: STORAGE OF 
ALCOHOLIC BEVERAGES 

(a) A private club brownbagging permittee 
shall see that alcoholic beverages are stored in 
compliance with the following conditions: 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1671 



PROPOSED RULES 



(1) All alcoholic beverages stored at the club 
shall be kept in individual lockers that are 
labeled with the members' names as they 
appear on the membership roster; lockers 
shall remain locked when the member is 
not on the premises; 

(2) Each locker shall contain a lock that can 
be opened only with a key, and the key 
shall be possessed by the individual 
member when that member is not present 
on the premises of the club; 

(3) No member shall store, whether in one 
or more lockers, more than few five liters 
of fortified wine or spirituous liquor, or 
few five liters of the two combined; few 
five liters of malt beverages; or few five 
liters of unfortified wine upon the prem- 
ises; 

Note: For example, one member may store 
the above mentioned quantities of alcoholic 
beverages in the aggregate in one or more 
lockers, such as a beverage locker and a sports 
equipment locker on one premises, provided 
that beverage containers and lockers are la- 
beled as required, and when he is not on the 
premises, the member has exclusive possession 
of the key or keys. 

(4) Alcoholic beverages belonging to different 
members shall not be stored in the same 
locker, except that a husband and wife 
may store alcoholic beverages in the same 
locker as long as the total quantity does 
not exceed the quantities stated in Sub- 
paragraph (3) of this Paragraph. 

(b) The permittee and his employee shall be 
responsible for returning to a member when he 
leaves the premises all malt beverages and unfor- 
tified wine brought to the club by the member in 
excess of the amounts that may be legally stored 
at the establishment by the member. 

(c) All alcoholic beverages left on the premises 
of the club contrary to the provisions of this Rule 
shall be destroyed by the permittee or his em- 
ployee. 

Statutory Authority G.S. 1SB-207; 1SB-301 (b) 
(3); 18B-1001 (7); 18B-1008. 

.0406 PRIVATE CLI BS WITH 

BROWNBAGGING/MIXED BEVERAGES 
PERMITS 

fe a private efeb with both a Mixed Beverages 
P e rmit a«4 a Brownhagging Permit, fee 
permittee r . hall comply with fee following Fe- 
quiromonts: 

f44 44** pormittoo shall Hf4 allow a member fc» 
possess more than few liters ef fortified 

11 ' 1 1*1 ■ > i \ r .'tMntn.Tiir 1 i ;i i l ii r r^ t- t.ii it- lit.it-.' r\ T * \~\ Q 
TTTTTV \ ' 1 LTL.'II 1 1 U V'U .' 1 l\.l 111 P 1 , I ' I ll.'LJl 1 1 I \. 1 3 VJ 1 I 1 TV 



twe- combined; mor e than 8© lit e rs ©f malt 
beverages; w more than 30 liters »f unforti 
fie4 wine ©«■ fee premises; 
(-3) 4fee permittee shall ensure feat- each con 
t ainer »f alcoholic beverages brought onto 
fee promis e s by a member is labeled immo 
diatoly with fee member's name substan 

t i ■ i 1 1 1 .' -\ e ft Q^^^^^^r^ /-iT-i tj^^i *" T 1 i ' 1 1 1 M L T~ ' M1T1 l"f \ ii t ■ 'i r ' 
L lllll T CCO rT U. L ..' l.'Llll J Ull L 1 IU IXXCIXXW] -'1 II L' 1UJIU1 J 

f4) Noithor a pormittoo nw a member shall 
furnish w hav e any person furnish a m e m 
ber's alcohoho beverage to- another member 
w a guest ef a member unless fee momb e r 
owning fee beverage is pr e sent fe fee li- 
oensed premises; 

(4) Oth e r than to label a container, w during 
private meetings w parties hefe under a 
Special Occasions Permit, neither a 
pormittoo ae* a» employeo shall possess w 
maintain custody ovor a member's alcoholic 
beverages w member's storag e locker k-ey-r 

rl 1 l\. '1 1 !VI ^TT I t\J I 1 1 IV 1 1 l\Jl 1 1 UV1 TT7 L'lU QC III CTTT cTTC 

Ucensod premisoo. 
Note: This Paragraph prohibits fee employees 
©f fee privat e club from handlmg a member's 
alcoholic bovoragos fe any way whatsoever 
othor than te- pw e» fee mombor's nam e lab e l 
w when a private function is being he!4 fep a 
private group under a Special Occasions Per 
mfe pursuant te GtS, 18B 1001( 8 ). fe is a vi- 
olation ef feis Rule fef a member's alcoholic 
bevoragos te be kept at w behind fee bap 
wh e r e mixed bovoragos afe prepared affe sold. 

Statutory Authority G.S. 18B-207; 18B-1008. 

.0407 CONGRESSION ALLY CHARTERED 
VETERANS ORGANIZATIONS 

A congressionallv chartered veterans organiza- 



tion holding a brown-bagging permit pursuant to 
G.S. 1 SB- 100 1(7) may provide its members with 
locker storage facilities on the premises. If such 
a permittee provides lockers, possession and 
storage of alcoholic beverages shall be in com- 
pliance with the rules of this Section. 

Statutory Authority G.S. 18B-207; 18B-1001(7). 

SECTION .0500 - ADDITIONAL 

REQUIREMENTS FOR MIXED BEVERAGES 

PERMITTEES 

.0502 PURCHASE TRANSPORTATION PERMIT 
/PURCHASE INVOICE FORM 

(a) A mixed beverages permittee or a desig- 
nated employee shall obtain a Purchase- 
Transportation Permit/Invoice Form form from 
the ABC store designated by the local board as 
the place where spirituous liquors liquor will be 
sold to mixed beverages permittees. 



1672 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



(b) A Purchase-Transportation Permit/Invoice 
Form, form, which shall be completed by the 
local ABC board, shall contain the following: 

(1) permittee's name; 

(2) trade name, address and telephone num- 
ber of the licensed premises; 

(3) permittee's Mixed Beverages Permit 
number; 

(4) name and driver's license number of per- 
son or persons authorized to purchase and 
transport spirituous liquors; liquor; 

(5) number and location of ABC store where 
purchase is to be made; 

(6) permittee's transaction or order number; 

(7) date of transaction; 

(8) destination of the spirituous liquore liquor 
which shall be the address given in Sub- 
paragraph (b)(2) of this Rule; 

(9) brand, quantity, size and item code 
number of each spirituous liquor con- 
tainer purchased and transported, includ- 
ing the serial number of each complete 
case or carton sold; 

(10) signatures of persons issuing and receiv- 
ing permit invoice form; 

(11) regular retail price per container; 

(12) mixed beverages tax per container; 

(13) total price per container; 

(14) total cost of transaction; and 

(15) date of order, date of purchase, and ex- 
piration date. 

(c) The Purchase-Transportation Permit; In- 
voice Form form shall be retained by the 
permittee for three years. 

Statutory Authority G.S. 1SB-207; lSB-403(d); 
18B-404. 

.0503 PRE-ORDERS 

A mixed beverages permittee shall make every 
effort to place orders for spirituous liquor; , liquor 
with the local board at least 24 hours in advance 
and in every case shall comply with local board 
policies regarding the purchase of liquors liquor 
for resale in mixed beverages. 

Statutory Authority G.S. 1SB-207; ISB-404. 

.0510 PRICE LISTS: MISREPRESENTATION 

(a) Each mixed beverages permittee shall have 
available for its customers a printed written price 
list containing current prices for the most com- 
mon or popular mixed beverages the permittee 
offers for sale. 

Any printed menu, master beverage price list or 
other printed written list that contains prices is 
sufficient as long as the prices listed are current 
and the list is readilv available to the customer. 



(b) Neither a mixed beverages permittee nor 
his employee shall misrepresent the price of any 
mixed beverage that is sold or offered for sale on 
the licensed premises. 

(c) A guest room cabinet permittee shall affix 
to the door of every in-room bar or cabinet a 
complete list of the current prices of each alco- 
holic beverage offered for sale from the cabinet. 



Statutory Authority G.S. 
(12); 18B-1007 (c). 



1 SB- 207; I SB- 1 '001 



.0512 STORAGE AND DISPOSAL OF 

SPIRITUOUS LIQUOR CONTAINERS 

(a) Locked Storage. All containers of alcoholic 
beverages possessed by a permittee for resale in 
mixed beverages shall be stored on the licensed 
premises in a separate look e d area out of view of 
the patrons of the establishment, except as pro- 
vided in Paragraph (b) of this Rule. 

(b) Container Display. A permittee may keep 
at each mixing station on the premises a rea- 
sonable number of containers of each brand of 
spirituous liquor likely to be used at that station, 
but no more than one container of each brand 
shall be open at one station at one time. A 
mixing station is a counter or other place where 
a bartender mixes drinks to be served to patrons. 
Generally, each bar counter is considered a single 
mixing station, but a counter may contain more 
than one mixing station if it is so long that more 
than one bartender is needed to serve the patrons 
at that counter. In that case the counter is 
normally considered to have as many mixing 
stations as there are bartenders at that counter. 
Each portable bar is considered a single mixing 
station. 

(c) Keys Required. Any lock used to secure 
the designated storage area shall be capable of 
being unlocked with a key that is avadable on the 
premises at all times. 

(d) Official Inspections. The designated stor- 
age area shall be open to inspection by the 
Commission or law enforcement officers pursu- 
ant to G.S. 18B-502. 

(e) Empty Containers. As soon as a container 
of spirituous liquor is empty, the permittee or his 
employee shall immediately and permanently 
deface the mixed beverages tax stamp and dispose 
of the bottle. 

(f) Inventory Records. During the first vcar 
of operation, the 44*e permittee shall maintain 
on a daily basis, an accurate inventory reflecting 
additions to and withdrawals from stock that 
specifies: 

(1) brand and container size of each item 
withdrawn; 

(2) date of withdrawal; and 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1673 



PROPOSED RULES 



(3) date partially used containers are returned 
to storage. 
This inventory shall be kept on a form approved 
bv the Commission. 

(g) Guest Room Cabinet Permittees. A hotel 
that has been issued a Guest Room Cabinet 
Permit mav store spirituous liquor and premixed 
cocktails purchased for resale from guest room 
cabinets in the same storage area with alcoholic 
beverages purchased for resale in mixed 
beverages, as provided in Paragraph (a) of this 
Rule. A hotel shall not. however, place on dis- 
)lay at mixing, stations any 50 milliliter contain- 



ers of liquor that were purchased for resale from 
cabinets. Pmptv or partially empty containers 
of alcoholic beverages purchased bv a room guest 
from a cabinet shall he disposed of bv the 
pennittee after the room guest has checked out 
of the hotel. 



Statuton Authority G.S. 18B-20' 
1 SB- 1 001 (12). 



1SB-502; 



.0513 PROHIBITED ACTS: HANDLING 
AND STORAGE OE LIQUOR 

Neither a mixed beverages permittee nor his 
employee, whether on or off the premises, shall: 

(1) add any alcoholic beverage to any con- 
tainer of spirituous liquor purchased for re- 
sale in mixed beverages; 

(2) transfer from one spirituous liquor con- 
tainer to another or remove from any liquor 
container the mixed beverages tax stamp or 
any other stamp, label, seal or device re- 
quired by law to be affixed to the container; 

(3) destroy, alter or deface the mixed beverages 
tax stamp or any other stamp, label, seal or 
device required by law to be affixed to a 
liquor container before the container has 
been emptied; 

(4) possess a counterfeit mixed beverages 
stamp, place a counterfeit mixed beverages 
stamp on any liquor container, or knowingly 
possess any container with a counterfeit 
stamp: 

(5) store any spirituous liquors liquor pur- 
chased for resale in mixed beverages in any- 
place other than the approved storage area 
of the premises specified in the purchase- 
transportation permit; 

(6) place or have in the approved storage area 
or possess elsewhere on the licensed prem- 
ises any container of spirituous liquor not 
bearing a mixed beverages tax stamp; 

(7) dilute or otherwise tamper with the con- 
tents of any container of alcoholic beverages; 

(8) give or sell to any patron any container of 
spirituous liquor that was purchased for re- 



sale as mixed beverages, whether the con- 
tainer is full or partially full; e* empty; 
provided, however, this prohibition shall not 
be construed to prohibit a room guest from 
removing from the hotel a container of al- 
coholic beverages purchased from a guest 
room cabinet; 
(9) possess any empty container of spirituous 
liquor purchased for resale in mixed 
beverages if the mixed beverages tax stamp 
on that container has not been permanently 
defaced; 

( 10) possess or sell on the premises any brand 
of spirituous liquor that has not been ap- 
proved by the Commission for sale in North 
Carolina or that was not purchased by the 
permittee pursuant to an approved special 
order; 

(11) purchase any spirituous liquors liquor for 
resale in mixed beverages other than as au- 
thorized by a valid purchase-transportation 
permit; 

(12) conceal or otherwise fail to indicate 
truthfully and accurately in any records re- 
quired to be kept by the permittee the sale 
of any alcoholic beverages on the licensed 
premises; or 

(13) make any other incomplete, inaccurate, 
false or misleading statements in any report 
or record required by these Rules. 

Statuton Authority G.S. 1SB-207; 1SB-404; 
18B-1001(12); 18B-1007; 1SB-1008. 

.0514 PROHIBITED ACTS: SERVING 
ALCOHOLIC BEVERAGES 

Neither a mixed beverages permittee nor his 
employee shall: 

( 1) sell or allow the consumption of any mixed 
beverages in an area other than one specif- 
ically approved by the Commission for that 
purpose; 

(2) sell, offer to sell, or serve on the premises 
any mixed beverage by customer self-service 
or allow any such sale or service, except that 
a guest room cabinet permittee may sell al- 
coholic beverages from guest room cabinets 
as authorized bv G.S. 1SB- 1001(12) and the 
rules of the Commission: 



(3) sell, offer for sale, or possess for the purpose 
of sale on the premises any alcoholic 
beverages that the permittee is not licensed 
to sell; 

(4) possess or consume, or allow any other 
person to possess or consume, on the 
premises any alcoholic beverages for which 
no permit is held if a permit is required by 



1674 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



law for the possession or consumption of 
that beverage; 

(5) misrepresent the brand of any spirituous 
liquor contained in any mixed beverage sold 
or offered for sale; or 

(6) sell or serve any brand of alcoholic beverage 
not identical to that ordered by the patron 
without first advising the patron of the dif- 
ference. 



Statutory Authority G.S. 
(12); 18B-I006 (d). 



18B-207; I8B-I001 



.0515 PRIVATE CLLBS: GENERAL 
PROHIBITIONS: GLESTS 

fa} Neither a private) eleb mixod b e verages 
permittee Hef hi* omployoo ohall: 

(44 allow asy- p e rson who is »et a member 
ef a bona fide guest ef a member to be 
present as a patron e» the premises ef a 

»-. n t • ■ . \ . | ;'1ii1t i -* r 

(3) grant membership privileges to the privato 

eh±b to aw parson oarhor than three days 

from the receipt ef his application fop 

membership. 

(b} "House" Guests. eto privato ektb mixod 

bev e rag e s permittee ftef hi* omployoo shall admit 

patrons as "house" guests. 

(e) Employee Member. A» employee wbe is 
alse a member ef a private eteb holding a Mixed 
Beverage Permit shall »et admit a patron as his 
guest while that- employee is e» duty. 

(4) A memb e r shall designate his own guest. 
If a member accepts a patron as his guest at- the 
bohost ef the privato ehib mix e d bev e rages 
pormittoo ef omployoo, then the Commission 
shall consider that member to be acting as the 
permittee's agent. 

Statutory Authority G.S. I8B-207; 18B-1008. 

.0516 PRIVATE CLLBS: MEMBERS' 
LIQLOR KEPT SEPARATE 

In a private club with both a Mixed Beverages 
Permit and a Brownbagging Permit, the 
permittee shall comply with the following re- 
quirements: 

(1) The permittee shall not allow a member or 
guest to possess on the premises more than 
tout five liters of fortified wine or spirituous 
liquor, or foaf five liters of the two com- 
bined, or more than SO liters of malt 
beverages ef moro than- 3Q liters ef unforti 
fied wine e«- the pr e mis e s: other than draft 
malt beverages in kegs; 

(2) The permittee shall ensure that each con- 
tainer of alcoholic beverages brought onto 
the premises by a member or guest is labeled 



immediately with the member's name s«b- 
stantially as it appears e» the membership 
rostor; or the guest's and sponsoring mem- 
ber's names; 

(3) Neither a permittee nor a member shall 
furnish or have any person furnish a mem- 
ber's alcoholic beverages to another member 
or a guest of a member unless the member 
owning the beverage is present on the li- 
censed premises; 

(4) Other than to label a container, or during 
private meetings or parties held under a 
Special Occasions Occasion Permit, neither 
a permittee nor an employee shall possess 
or maintain custody over a member's alco- 
holic beverages or a member's storage leek 
locker key, whether or not the member is 
present on the licensed premises. 

Note: This Paragraph prohibits the employees 
of the private club from handling a member's 
alcoholic beverages in any way whatsoever 
other than to put on the member's name label 
or when a private function is being held for a 
private group under a Special Occasions Oc- 
casion Permit, pursuant to G.S. 18B-1001(8). 
It is a violation of this Rule for a member's 
alcoholic beverages to be kept at or behind the 
bar where mixed beverages are prepared and 
sold. 

Statutory Authority G.S. 18B-207; I8B-I006(b); 
1 SB- 1008. 

.0518 PRIVATE CLLBS: FINANCIAL 

STATEMENTS: RECORD KEEPING 

(a) A private club holding a Mixed Beverages 
Permit shall maintain full and accurate monthly 
records of its finances, separately indicating each 
of the following: 

(1) amounts expended for the purpose pur- 
chase of spirituous liquor from ABC 
stores and the quantity of spirituous liq- 
uor purchased; 

(2) amounts collected from the sale of mixed 
beverages and, by brand and container 
size, the quantity of spirituous liquor sold; 

(3) amounts received in payment of members' 
dues; 

(4) amounts received from charges to mem- 
bers and guests of members; 

(5) quantity of spirituous liquor, by brand and 
container size, that was not sold but is no 
longer on the licensed premises due to 
stated reasons, such as breakage or theft. 

(b) Records of purchases of spirituous liquor 
and sales of mixed beverages shall be filed sepa- 
rate and apart from all other records maintained 
on the premises. 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1675 



PROPOSED RULES 



(c) Records, including original invoices for the 
items in Paragraph (a) of this Rule, shall be 
maintained on the premises for three years and 
shall be open for inspection or audit pursuant to 
G.S. 18B-502. 

(d) A private club holding a Mixed Beverages 
Permit shall submit to the Commission for its 
review, on forms provided by the Commission, 
regular reports summarizing the information re- 
quired to be maintained by this Rule. These re- 
ports shall be submitted on a quarterly basis 
during the first year of operation as a licensed 
premises and. thereafter, on an annual basis or 
on a schedule set by the Commission. 

Statutory Authority G.S. 1SB-207; 18B-1008. 

.0519 RESTAURANTS: INCOME FROM SALES 

(a) For the purposes of further defining a res- 
taurant, as provided in G.S. 18B-1000(6), the 
term "substantially engaged in the business of 
preparing and serving meals" means that more 
than fifty percent of the establishment's food and 
beverage sales are from the sale of food and 
non-alcoholic beverages. 

(b) In detennining what portions of sales can 
be attributed to the sale of food and non- 
alcoholic beverages, all food aft4 beverage sales 
may be included except: the following sales may- 
be included: 

f++ mixed beverages, including the mixer; a&& 

£2) afty other alcoholic bevemgea fmalt 
beverages, unfortified wines a«4 fortified 
wines). 

1 1 ) food prepared in the permittee's kitchen 
and served as a meal to be consumed on 
the premises or as a "take-out" order; 

I 2) prepackaged food sold to accompany the 
meal. 

(3) non-alcoholic beverages sold to accom- 
pany the meal. 

(c) In determining what portions of sales can 
be attributed to the sale of food and non- 
alcoholic beverages, the following items may not 
be included: 

I 1 i mixed beverages, including the mixer: 

(2) anv other alcoholic beverages 

(3) grocer.' items not ordered and purchased 
with meals; 



(4) cover charges. 

Statutory Authority G.S. I8B-207 

1 SB- 1008. 



1 SB- 1000(6); 



.0520 RESTAURANTS. HOTELS, AND TOL R 
BOATS: RECORD KEEPING 

(a) Monthly Records. Restaurants, aft4 hotels 
>*4*b- restaurants and tour boats holdma Mixed 



Beverages Permits shall maintain full and accu- 
rate monthly records of their finances, separately 
indicating each of the following: 

(1) amounts expended for the purchase of 
spirituous liquor from ABC stores and the 
quantity of spirituous liquor purchased: 

(2) amounts collected from the sale of mixed 
beverages and, by brand and container 
size, the quantity of spirituous liquor sold; 

(3) if a guest room cabinet permittee, the 
amounts collected from the sale of liquor 
from guest room cabinets, and bv con- 
tainer size, the quantity of liquor sold 
from cabinets: 

(4) f?H the quantity of spirituous liquors, liq- 

uor, by brand and container size, that was 
not sold but is no longer on the premises 
due to stated reasons, such as breakage or 
theft; 
£5[ (-H if a restaurant or tour boat, amounts 
collected from the sale of: 

(A) food and non-alcoholic beverages; 

(B) items other than food and beverages of 
all kinds: and 

(C) malt beverages, unfortified wine and 
fortified ' . vines, wine; 

(6) (4| if a hotel, amounts collected from: 

(A) furnishing lodging; 

(B) sale of meals; 

(C) sale of malt beverages, unfortified wine 
and fortified wine: and 

(D) amounts collected from all other 
sources. 

(b) Segregation of Records. Records of pur- 
chases of spirituous liquors liquor and sales of 
alcoholic beverages shall be tiled separate and 
apart from all other records maintained on the 
premises. 

(c) Retention and Inspection of Records. Re- 
cords, including original invoices related to alco- 
holic beverages and mixed beverages, shall be 
maintained on the premises for three years and 
shall be open for inspection or audit pursuant to 
G.S. 1SB-502. 

(d) Submission of Financial Records. A res- 
taurant, tour boat, or a hotel with a restaurant 
holding a Mixed Beverages Permit shall submit 
to the Commission for its review, on forms pro- 
vided by the Commission, regular reports sum- 
marizing the information required to be 
maintained by this Rule. These reports shall be 
submitted on a quarterly' basis during the first 
year of operation as a licensed premises, and 
thereafter, on an annual basis or on a schedule 
set by the Commission. 

Statutory Authority G.S. 18B-207; 1SB-1006H): 
1 SB- 1008. 



16*6 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



.0523 HOTELS: INCOME FROM SALES 

For the purpose of defining a hotel, the term 
"substantially engaged in the business of furnish- 
ing lodging" in G.S. 18B-1000(4) means that the 
establishment's gross receipts from the rental of 
lodging rooms, sale of food, and sale of non- 
alcoholic beverages are greater than its gross re- 
ceipts from the sale of alcoholic beverages. 

Statutory Authority G.S. 18B-1000(4); 18B-100S. 

.0524 GUEST ROOM CABINET PERMITTEES: 
PURCHASES OF LIQUOR 

(a) Ordering Liquor. A guest room cabinet 
permittee shall comply with Rule .0503 of this 
Section and place orders for liquor to be sold 
from guest room cabinets in accordance with the 
local board's rules and the following additional 
conditions: 

( 1 ) Orders for Liquor to be sold from cabinets 
shall be placed separately from orders for 
liquor to be resold in mixed beverages; 

(2) Liquor may be purchased for resale from 
cabinets in 50 milliliter sizes only; pre- 



1M 



mixed cocktails purchased for resale from 
cabinets may be purchased in 375 millili- 
ter sizes only. 

Mixed Beverages Surcharge Stamps. A 
guest room cabinet permittee who receives unaf- 
fixed stamps from a local board shall immediately 
affix one stamp to each container of liquor before 
the container is logged into the permittee's in- 
ventory. Errors in receiving incorrect numbers 
of stamps or containers from local board per- 
sonnel shall be the responsibility of the permittee 
at the time of purchase. 

Statutory Authority G.S. ISB-207; 18B-404(d); 
18B-1001(12). 

.0525 GUEST ROOM CABINETS; 
INVENTORY AND RECORDS 

A guest room cabinet permittee shall maintain 
on the premises complete and accurate inventory 
and sales records of a)J liquor purchased for resale 
in cabinets in accordance with the following re- 
quirements: 

(1 ) During the first year of operation with a 
Guest Room Cabinet permit, inventory re- 
cords for guest room cabinet liquor shall be 
maintained as required by Rule .0512(0(1) 
and (2) of this Section. 

(2) Sales records of guest room cabinet liquor 
shall be kept on a monthly basis in accord- 
ance with the requirements of Rule .0520 of 
this Section. 



(3) Purchase-transportation permits for liquor 
to be sold from guest room cabinets shall 
be maintained by the permittee on the 
premises for a period of three years. 

Statutory Authority G.S. 18B-207; 18B-1001 ( 12). 

.0526 GUEST ROOM CABINETS; SALES 
OF ALCOHOLIC BEVERAGES 

(a) Restrictions on 50 Milliliter Containers 1 



A guest room cabinet permittee shall not display 
or sell any 50 milliliter container of liquor on any 
part of the hotel premises other than in guest 
room cabinets installed in guest rooms. 

(b) Cabinet Ix>cks and Kevs. A guest room 
cabinet shall contain a lock which may be 
opened only with a key that is separate from the 
hotel room key. Electronically operated locking 
systems for guest room cabinets may be installed 
bv a permittee upon written approval of the 
Commission when it has been shown that the 
electronic locking system contains adequate safe- 
guards against underage persons being able to 
obtain alcoholic beverages from guest room cab- 
inets. 

(c) I .odging Guests. No guest room cabinet 
permittee or his employee shall give a guest room 
cabinet key to any person under 21 years of age. 
No lodging guest shall be required to accept a 
guest room cabinet key if the guest does not wish 
to have a key. 

(d) Price List. Fvery guest room cabinet in- 
stalled by a permittee shall have firmly affixed to 
the door of the cabinet a complete list of all al- 
coholic beverages offered for sale from the cabi- 

the current price of each alcoholic 



net and 

beverage. 

(c) Notice of Age Requirement. In addition 
to the price list required iri Paragraph (d) of this 
Rule, each guest room cabinet shall contain a 
notice to guests that reads as follows: "IT IS 
UNLAWFUL IN NORTH CAROLINA LOR 
ANY PERSON TO GIVE ALCOHOLIC 
BEVERAGES TO ANY PERSON UNDER 21 
YEARS OF AGE. G.S. 1SB-302." 

Statutory Authority G.S. I8B-207; 18B-302(a); 
18B-404(d); 18B-1001 ( 12). 

.0527 GUEST ROOMS CONSIDERED 
RESIDENCE 

(a) 1 aw Enforcement Jurisdiction. A hotel 
room is considered a place of temporary resi- 
dence and not part of the permittee's retail 1U 
censed premises. Therefore, when a hotel room 
has been rented to a lodging guest, entrance by a 
law enforcement officer into the guest room is 
governed by the same laws as entry into any res- 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1677 



PROPOSED RULES 



idcnce. notwithstanding the fact that the hotel 
has installed a guest room cabinet in the room. 



1 or the purposes of enforcing the ABC laws 
related to guest room cabinets, a permittee shall 
allow Alcohol I aw Enforcement agents, local 
ABC officers and employees of the Commission 
reasonable access to guest rooms that are not 
rented to a lodging guest at the time of the in- 
spection. 

(hi Certain Restrictions Not Applicable to 
Guest Room Cabinet Sales. Because a rented 
hotel room is considered a temporary' residence, 
the rooms are not considered part of the 
permittee's retail licensed premises. Therefore, 
statutes and rules regulating such areas as hours 
o\_ sale, "happy hours." and advertising are not 
applicable to sales oj^ alcoholic beverages from 
hotel cabinets. 

Statutory Authority G.S. 18B-207; 18B-30l(a); 
1 8 B- 502; 1 SB- 100 1 ( 12). 

.0528 MIXED BEVERAGES CATERING 
PERMITS; GENERAL 

(a) I. iquor Purchases. I iquor catered by a 
mixed beverages permittee shall he purchased by 
the permittee from the mixed beverages store 
operated by the local ABC board for the ]uns- 
diction in which the restaurant or hotel is issued 
a Mixed Beverages permit. A hotel or restaurant 
with a Mixed Beverages Catering permit shall not 
cater any liquor on which the mixed beverages 
surcharge imposed by G.S. lSB-804(b)(S) has 
not been paid. 

(b) Cash Bars Prohibited. The Mixed 
Beverages Catering permit does not authorize the 
sale £\_ individual mixed beverages at a catered 
event. There lore, no mixed beverages catering 
permittee shall set up_ a cash bar for beer, wine 
or mixed bev erages at anv place other than on 
the licensed premises of the hotel or restaurant. 

(c) Food Required. A mixed beverages 
catenng permittee who is catering liquor at an 
event held off the licensed premises of the hotel 
or restaurant shall also cater food at that event. 

(d) Intent of Rules. Nothing in the provisions 
ot the rules ot the Commission shall be construed 
to allow a mixed beverages catering permittee to 
contract with the holder of a Special Occasions 
or Brownbaggmg permit to serve or sell mixed 
beverages to the patrons of that permittee's 
business for a function to be held at the location 
for which those permits were issued. 



Statutory 
18B-207; 

1 SB- 1 008. 



Authority G.S. 18B- 
ISB-lOOl(B); 



203 (a) (1); 
18B- 1007(a); 



.0529 MIXED BEVERAGES CATERING 
PERMITS IN "DRY AREAS" 

(a) Definitions. For purposes of this Rule, the 
following definitions shall apply: 

( 1) 'Dry area" means a jurisdiction in which 
the sale of mixed beverages has not been 
approved in an election held pursuant to 
G.S. 18B-6P1) or by anv other provision 
of the ABC laws. 

(2) "Private function" means an unadvertised 
event for which the host has issued per- 
sonal invitations. Events for which invi- 
tations arc issued bv radio, television, 
newspaper, circular or fliers to the general 
public shall not be construed as 
"private." 

(b) Restrictions. In addition to the guidelines 
in Rule .0528 of this Section, the following addi- 



tional restrictions shall apply to all events being 
catered in areas in which the sale of mi xed 
beverages is not lawful: 



in 



oi 



1 iquor may be catered at political or 
charitable events held to allow a non- 
profit or political organization to raise 
funds where the host organization has 
obtained a Special One-Time permit pur- 
suant to G.S. 18B-1002(5) authorizing the 
serving of mixed beverages to persons at- 
tending the event . These tund-raising 
events mav be private or open to the 
public, and may be held on private, com- 
mercial, or government owned property. 

1 iquor may be catered at anv private 
function held on the premises of a busi- 
ness that holds a Special Occasion permit. 
or for a person who has obtained a I un- 
ited Special Occasion permit only if 

(A) the host is not a permittee who has 
been issued a Special Occasion permit 
pursuant to G.S. lSB-li)l)l(S): and 

(B) there is no admission charged to those 
attending. 



(3) I. iquor may be catered at any private 
function held on private residential or 
non-commercial property so long as no 
admission is charged to those attending. 

Statutory Authority G.S. lSB-203(a); lSB-20~; 
1SB-301 (a), (c);~ 18B-603; 18B-I00I; 18B-100I 
(13); ISB-1002 (5). 

SECTION .0600 - SPECIAL REQUIREMENTS 

FOR CONVENTION CENTERS, COMMUNITY 

THEATRES, SPORTS CLLBS, AND 

NONPROFIT AND POLITICAL 

ORGANIZATIONS 

.0601 CONVENTION CENTERS: GENERAL 
REQUIREMENT 



16 "8 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



(a} Definition. As used i» this S e ction, the 
toim "convention center" moons civic contoro, 
armories, auditoriumo, a»d coliseums. 

fb) Sales. A convention center dooiring te seb 1 
malt boveragos, win e ©f mix e d b e v e rages te con 
vontion groups ep similar largo gatherings shall 

f i tM-il \ | T t -\ r ■ i ia , 1 , ^ lit nn fliii ■-» T-i T-i *-/~l tMi-it .t iifl Q£ajQ«j;ag 

u l' i .' i t tut uii iu crrninT 1 1 iv u. i 1" " ' i ' 1 1 u i v itii - I'lutows 

retail sales permits. 

(e) Sp e cial Occasions. Convention centers 
shall obtain a» annual Special Occasions Permit 
©f require a lossoo te obtain a limited Special 
Occasions Pormit eF Special One timo 

l v l\ iUi LJ 1 li tj MM'' i i M 'l I"1 I t i "l i W I W" i * I 1 [ IU I D f 1 nu f\^Ff *"\y* 
«.-* i v_> »• 1 1 t'"w-jJ i S 1 1 1 1 IJ I ULIU 1 U Llll U Tf KEXK Llll T J- *- * -'"" 

te possess a&4 consum e fortified wine ©f 
spirituous liquor eft aey ©art ef its promises. 

Statutory Authority G.S. I8B-207; 18B-900(e); 
I8B-I000(la). 

.0603 CONVENTION CENTERS: CATERER 
MAY PERFORM ACTIVITIES 

The Commission H*ay allow a convention ee«- 
t e r's independent cat e ring contractor te ongago m 
ah the activities authorised by the permits issued 
te the convention center. Aey- caterer se con 
tracted shall meet ah r e quir e ments feF applicants 
as proscribed m G^ 1 S B 900(a) aae (hy, «h- 
mato responsibility f©f violations ©f the ABC 
laws shall rest i» the ownor ©f oporator ©f the 
convention center. 

Statutory Authority G.S. ISB-207; 18B-900(e). 

.0605 CONVENTION CENTERS: MIXED 
BEVERAGE RECORDS 

fa} f» liee ©f the requirements set- forth i» 
Rules .0518 aa4 .0520 ©f this Subchapter r e gard 
Ȥ record keeping, a convention contor holding 

a\ lutflfl Bai n uaiQflc Dacnaii ela aJJ oa •"»■ p * a « «~» A 1 11 a«j 
: * 1 1 avu u^t^i tje;^;t i ~i 1 1 1 1 1 ru till I 1 1 liiii i ccccl I 1 1 1 1 r rtrtrr 

accurate monthly r e cords ©f its finances, s e pa 
rately indicating e ach ef the following: 

(44 amounts expended fe* the purchas e ef 

spirituous liquor from ABC stores a©4 the 

quantity ef liquor purchased; 

f3} amounts collected from the sale ef mixed 

beverages, aftdr by brand a«4 container 

■"' 1 1 1 \ t H. I 1 1 1 I I I T1 t 1 1 1 I a! .-»->■ i-itiiniii- lu-illAr L'."ilil ! 

nn .^-' ■ U1L 1 Lj Mill II IT T tTT VI 'II 1 1 \J\ } U 3 IWJUW1 VI I IU , 

| -) ; nil.'l nil t V CM ■ T">1 I'l l" ^' »■-• Iwnnr faj - krin, 1 fin.-l 
\—" / "-J *-*«-*! 1 1 ll_T tTT 9pn 1 1 LI \J U J IlUUtfl , l * T tTTTTTTTT FTTTTT 

container swer that- was net- sel4 bet is se 

longer ©ft the licensed premiL . es ewe te 

stated reasons, such as breakage ©f theft. 

fb4 Maintaining R e cords. R e cords ef eer- 

chases ef spirituous liquor s&4 sales ef mix e d 

beverages shah be file© s e parate aft© apart from 

ah oth e r records, aft© the r e cords, including eri- 

ginal invoices, shah be keet ©ft the promises at- 

ah tim e s fee a p e riod ef three years. 



Statutory Authority G.S. I8B-207; I8B-I008. 

.0606 COMMUNITY THEATRES: SALES 

A community thoatro desiring te sell malt 
b e verages, win e , ©f mix e d b e veragos shall apply 
fof a»4 obtain the appropriate on pr e mis e s retail 

Statutory Authority G.S. 18B-207; 18B-1000(1). 

.0607 COMMUNITY THEATRES: 
QUALIFICATIONS 

4he Commission may investigate each com 
munity theatr e applicant te onsuro that- it- is 
non profit aft4 that- its sele business is sponsoring 
eF presenting theatrical events te the public. 

Statutory Authority G.S. I8B-207; 18B-1000(1). 

.0608 COMMUNITY THEATRES: WHEN 
PERMITS VALID 

Permits issued te community thoatros ate valid 
©thy during regularly scheduled theatrical e vents 
sponsored by- the applicant. The Commission 
tsay dotormino, based ©» calendars ef events aft4 
other evidence, which events a*e regularly sched 

Statutory Authority G.S. 18B-207; 18B-1000(1). 

.0609 COOKING SCHOOLS: SALES 

A cooking school desiring te seh unfortified 

1 1 ' 1 f 1 ■ \ I t r 1 I > 1 ' I > H l"'"-"" t \ I 1 -~* CJ '*■"*■ I 1 I • l ■ i , v r.if ■' i i I i r-\ i-\ r-t t 

purposes shall apply fof aed- obtain the appro 
priato permits. 

Statutory Authority G.S. 18B-207; 18B-1000( lb). 

.0610 COOKING SCHOOLS: 
QUALIFICATIONS 

The Commission may investigate each cooking 
school applicant te ensure that- it- is a bona frde 
school that- is substantially engaged » teaching 
cooking techniques. The school shall charge a 
fee fet its courses. 

Statutory Authority G.S. 18B-207; 1SB-10()0( lb). 

.061 1 COOKING SCHOOLS: SALES 
RESTRICTED TO STUDENTS 

A cooking school shall eet- seh food ef alcoholic 



b e verages 
students. 



te afty- person other tha» its bona fide 



Statutory Authority G.S. ISB-207; I8B-I006(g). 

.0612 RECORD KEEPING 

(a) Convention centers, community theatres, 
sports clubs, nonprofit and political organiza- 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1679 



PROPOSED RULES 



tions holding Mixed Beverages permits shall 
maintain full and accurate monthly records of 
th.-ir iiiMTK,-- separately indicating each of the 
following: 

( 1 ) amounts expended for the purchase of 
spirituous liquor from ABC stores and the 
quantity of spirituous liquor purchased; 

(2) amounts collected from the sale of mixed 
beverages and, bv brand and container 
size, the quantity of spirituous liquor sold; 

(3) the quantity of spirituous liquor, by brand 
and container si/e. that was not sold but 
is no longer on the premises due to stated 
reasons, such as breakage or theft. 

(b) Segregation of Records. Records of pur- 



chases of spirituous liquor and sales of alcoholic 
beverages shall e filed separate and apart from 
all other records mamtained on the premises. 

(c) Retention and Inspection of Records. Re- 
cords, including original invoices related to alco 
holic beverages and mixed beverages, shall be 
maintained on the premises for three rears and 
shall be open for inspection or audit pursuant to 
G.S. 1SB-502. 

(d) Submission of Financial Records. A 
permittee holding a Mixed Beverages permit un- 
der this Rule shall submit to the Commission for 
its review, on forms provided bv the Commis- 



sion, regular reports summarizing the informa- 



tion required to be maintained bv the rule. 
These reports shall be submitted on a quarterly 
basis during the first year of operation as a li- 
censed premises, and thereafter, on an annual 
basis or on a schedule set bv the Commission. 

Statutory Authority G.S. 18B-207; I SB- 1007. 

SECTION .0700 - SPECIAL OCCASIONS 
PERMITS 

.0703 STORAGE OF ALCOHOLIC BEVERAGES 

£a) Annual Sp e cial Occasions Permit: Storage. 
Except as- provided m Paragraph (&} e4 this Rule, 
a special occasions permittee shall fte* provid e 
storag e fof alcoholic bev e rages except during 
preparation fof evf during the time a special ee- 
casion t+ talring place. 44h* host, however, does 
have a reasonable time t& remove l e ftover alco 
holio beverages, 4hk Rule shah F*rt be e©«- 
stnied to prohibit a mixed beverages permitte e 
from storing alcoholic beverages purchased tot 
resale » mixed beverages a* required to- Section 
.0500 e4th*s Subchapt e r. 

(-h+ I united Sp e cial Occasions Permit: Storage. 
44w holder &£ a L unit e d Special Occasions Pep- 
»«• whe- ake possesses a Purchas e 
Transportation Permit issued pursuant to G.S. 
lS'B lO.^ig i mav stor e alcoholic beverages e» the 



premises ef a commercial estabUohmont tof 4% 
hours before a»4 4£ hours after the function a* 
long as the beverages are stored m a secure afea 
a«4 at© Het stor e d » a mixed beverage 
permittee's locked storag e ar e a. 

Alcoholic beverages possessed under a Special 
Occasion Permit or a Limited Special Occasion 
Permit may be stored on the premises covered 
bv the permit in accordance with G.S. 
18B-403(g), as long as the beverages are stored in 
a secure area and are not stored in a mixed 
beverage permittee s storage area or commingled 
with the mixed beverages inventory. 

Statutory Authority G.S. 18B-207; I8B-403(g); 
18B-1001(8),(9). 

.0704 NOTICE TO BE POSTED 

When a private function is being held under a» 
annual a Special Occasion Permit or Limited 
Special Occasions Occasion Permit, the permittee 
shall post a notice certifying that a private func- 
tion is being held. The notice shall be posted in 
that area of the establishment in which alcoholic 
beverages are being consumed or possessed. 

Statutory: Authority G.S. 18B-207. 

.0705 NO PERMIT REQUIRED AT 
APARTMENT CLUBHOUSE 

A Special Occasions Occasion Permit is not re- 
quired of club rooms or social centers that are 
provided by apartment complexes or multiple 
family housing projects for use by residents and 
their guests for parties, meetings or other social 
events as long as no more than a nominal fee is 
charged to cover additional or special janitorial 
services. In those instances the club rooms or 
social centers shall be considered a reasonable 
extension of the residents' private residences, and 
no Special Occasions Occasion Permit is re- 
quired. A club room or social center shall be 
considered a commercial establishment for which 
a Special Occasions Occasion Permit is required 
if the club room or social center: 

(1) is rented to nonresidents of the multiple 
family housing complex; 

(2) is rented to residents for a charge in excess 
of that reasonably calculated to cover addi- 
tional or special janitorial services: or 

(3) holds a retail Malt Beverage. Unfortified 
Wine, Fortified Wine, or Mixed Beverages 
Permit. 

Statutory Authority G.S. 18B-207; 18B-301(c). 

.0706 WHEN PERMITS INVALID: MIXED 
BEVERAGE SALES 



1680 



6:22 NORTH CAROLINA REGISTER February 14, 1992 






PROPOSED RULES 



When mixed beverages are being sold in a pri- 
vate dining area, any other private area, or when 
the entire premises is being used for a private 
function, any Special Occasions Occasion Permit 
that would otherwise be applicable to the prem- 
ises or area of the premises is invalid for that pe- 
riod, and no person shall possess any spirituous 
liquor at that private function other than the 
permittee and his employees. 

Statutory Authority G.S. I8B-207; 18B-1008. 

.0707 DESTRUCTION OF LEFTOVER 
BEVERAGES 

The owner or operator of a commercial estab- 
lishment holding a» annual a Special Occasions 
Occasion Permit shall destroy all unfortifi e d 
wino, fortified wine and spirituous liquor left on 
the premises by the host of a private function 
more than 48 hours after the conclusion of the 
function. 

Statutory Authority G.S. 18B-207; 18B-403(g); 
1 SB- 100 1(8). 

.0708 TYPES OF PERVIITS REQUIRED 

The owner or operator of any commercial fa- 
cility or commercial establishment renting or 
furnishing the premises thereof for a private 
function where the host of the function will pos- 
sess more than five liters of fortified wine or 
spirituous liquor, or five liters of the two com- 
bined, shall either: 

(T) apply for and obtain a Special Occasion 
Permit, as required by GS. 18B- 1001(8) and 



G.S. 



SB-^or 



(2) require the person in charge of the private 
function to apply for and obtain a Limited 
Special Occasion Permit under the pro- 
visions of G_S_ 1813-1001(9) and 18B-902. 

Statutory Authority G.S. 1SB-207; J8B-30I (c); 
18B-1001 (8), (9). 

SECTION .0800 - CL LINARY PERVIITS 

.0801 GENERAL REQUIREMENTS 

fa) fe addition te the general requirements fof 
restaurant r . aftd hotels as d e fined fo Gt&t 
lftB 1000. a parson operating a r e staurant, hotel 
ef catering service shall alse meet the following 
minimum standards te qualify fof a Culinary 
P e rmit: 
f+4 a^he business dees Bet- hel4 a Mix e d 
Beverages Permit issued pursuant te G-£r 
1SB 1001 (4% 
f2) Foods i» which win e aft4 liquor ate us e d 
shall he served r e gularly; 



I l\ All i 1 ■« mi mill li/inur | • li ■ i 1 1 1^^ nKt-nnml Ini hi 

r .TT ' *-ll ft 1 1 HJ trrra IIU Ul\s 1 -JI III LI UJU \J I. J I WU 1 L^T rTTTTTT 

a lawful source within this State; aftd- 

I A\ I fa --> hni-irini-i- hot- ^ /'i.'U ■"* tj nirh i-if lirtiii I i~i t-i 

I it i i x\j uujiin. 1 j^ i itzrr cr ctttttt kj i cttttttott iij i\_^t uh 

its menu, the recipe fof which utilizes 
wine ef hquor i» the preparation. 
fb) 1ft addition te the gen e ral r e quirem e nts fof 
cooking schools as defined i» G.S. 1 SB 1000, a 
person operating such a school shall meet the 
requirements ef Subparagraphs (a)( 1) a»4 (•£) ef 
♦ u:.. d , 1 1 .-* 

(e) A»y restaurant ef hotel w+th a Mixed 
Beverages Permit may «se fof culinary purposes 
a»y- fortified wino ef spirituous Uquor it- has pur 
chased fof r e sal e fo mixod bovoragos. 

In addition to the general requirements for res- 
taurants, hotels and cooking schools in G.S. 
1 SB- 1000 and the Rules of the Commission, a 
restaurant, hotel, cooking school or catering ser- 
vice using fortified wine or spirituous liquor for 
culinary purposes shall obtain those alcoholic 
beverages from a layvful source within this State. 

Statutory Authority G.S. 18B-207; 18B-1000 
(lb), (4), (6); 18B-1001 (II); 18B-1006 (h). 

.0802 POSSESSION AND STORAGE OF 
WINE AND LIQUOR 

(a) A restaurant, hotel, cooking school, ef 
catering s e rvice may legally possess fof culinary 
purposes ee to- 4-2 liters ef fortified wine ef 
spirituous liquor, ef 4-2 liters ef the twe com 
bined, at its business location fef at the cooking 
sl+e when the p e rmitt ee is a catering service). 

fb) 4he restaurant , hotel, cooking school, ef 
catering s e rvico p e rmittee shall destroy all wino 
ef liquor left e» the promises contrary te the 
provisions ef this Section. 

Statutory Authority G.S. 18B-207; 183-1001(11). 

.0803 RECORDS REQUIRED 

44»e permittee shall retain all original r e ceipts 
a«4 records el fortified wine ef spirituous liquor 
purchased fef culinary purposes : during the p*e- 
vious three y-eaf period. aee. those records aftd- 
receipts shall he available fof insp e ction. 



Statutory Authority 
183-1001(11). 



G.S. ISB-207; 1SB-502; 



.0804 USE OF WINE AND LIQUOR 

/■it I r\ t-n-, in -i ii r-i . y LiAilr t ti • 1 t «-■ ^ Q i i < *-. > g O *•"*"* -~* I ■ . r t ■ . . . i 
\ 11 J III I'lL I'lll MIC, TTTTTTTTT I I 111 I 1 LU U11L 1 C I l~' 1 1 1 Ul ,1 V. L 

el" alcoholic seasoning, alcohohc content el the 
food shall Het- exceed 3H p e rcent ef the total food 
volume. 1ft preparing sauces r e quiring alcoholic 
b e verages, alcoholic cont e nt shall Ret exceed eO 
percent ef the total volume ef the sauce. 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



16S1 



PROPOSED RULES 



^b) A monthly inventory shall be mad e ei for- 

♦ «ti,wl 1 1 ■ ■ «-l . h ft t-i , 1 a ; *-\ ■ **^ tmmr lull w\ f i i ■ . hi T / \ t* * > i i 1 ■ n ^i t : 

1 1 1 1 UTJ VT 111^ til IKM r*t 'Mil UTf tiy rTTTTTTTT U "VU TTTT I'UIIIIUI T 

purposes a«4 shall be available* fof inspection. 

fe) AH- fortifiod wino a«4 spirituous hquor, 
when net- to tts#7 shall be inconspicuously stored 
i» the kitchen area. 

ftb> Fortified wino aft4 spirituous liquor «se4 
fof culinary purposes afe allowed to the service 

atflfl i"> T tli . i «-. ii I'iiir'int iinli; n'ln» -± »-.-.>-<■,- i i I t i- 1/ i, v, I 
CTrCTT Ul l I I\J 1 L.'IUUIUIII U 1 1 1 J ttTTCTT CT PUl llL'UIUl TTTTTCT 

requiring that- wino ef liquor » being prepared 
e* s e rv e d. 

Statutory Authority G.S. ISB-207; 18B-1001 ( 1 1 ). 

SECTION .0900 - WINE AND BEER TASTINGS 

.0902 TASTINGS HELD BY INDUSTRY 

MEMBERS FOR NON-PERMITTEES 

Where the legal sale of those beverages is per- 
mitted, an industry member may furnish wine or 
malt beverages for tastings to persons who efo ftet- 
hold ABC permits, for consumers provided that: 

(1) The tasting is conducted for promotional 
purposes; 

(2) No alcoholic beverages are sold, no sales 
or orders are solicited, and no order blanks 
are placed in or about the premises; 

( 3) : fbe tasting » Ret- heW- e« the promises e£ a 
retail ABC permittee. If the tasting is held 
on the premises of a retail permittee, the in- 
dustry member may purchase the products 
to be used from the retailer so long as the 
purchase price is no higher than the retailer's 
ordinary retail pnce; 

(4) If wine or beer is furnished by the industry 
member for a consumer tasting held in con- 
junction with a retailer, any excess brought 
to the tasting is removed hv the industry 
member; and 

(_5j H a l.istiiiL' i_> conducted m conjunction with 
a retailer, the industry member makes no 
payment to or on behalf of the retailer for 
promoting and advertising the tasting. 

Statutory Authority G.S. ISB-207; I8B-II07 (a) 
(4); 18B-1109 (a) (4); 18B-11I6 (b). 

.0903 TASTINGS HELD BY INDUSTRY 

MEMBERS FOR RETAILERS: SAMPLES 

(a) Samples. An industry member may give 
samples of wine or malt beverages to a retail 
permittee authorized to sell that beverage under 
the following circumstances: 

( 1 ) The industry member may give the retailer 

Q r\ i-~j ri/ittl Q >-"l *■ /-»o n i~l t r~i ■ . , ■ l-i finnli ■ 1 i L t , t , t 

\ M It I ' 1 1 I I 1 TTT C 111 I \J 1 CTT^TT nvrTTT 1 1 M L II 

product be offers fof salei up_ to three gal- 
lons per brand of malt beverages and up 
to three liters per brand of wine; and 



(2) The retailer has not previously purchased 
those brands from the industry member. 
(b) Qf Tastings. The industry member may 
give the retailer samples by the glass of any pro- 
ducts he offers for sale. Such a tasting may be 
conducted on the industry member's premises or 
at any other location approved by the Commis- 
sion for that purpose. A tasting under this Par- 
agraph shall not be conducted in conjunction 
with a meal, a party, or any other social event 
but shall be for business purposes only. 

Statutory Authority G.S. 18B-207; I8B-IJ07 (a) 
(4); I8B-1109 (a) (4); I8B-1116 (b). 

SECTION .1000 - ADVERTISING 

.1001 DEFINITIONS 

As used in this Section: 

(1) The terms defined in G.S. Chapter 18B and 
Subchapters 2R through 2T of this Chapter 
shall have the same meaning when used in 
this Section. 

(2) "Advertising" means the publicizing of the 
trade name of a permittee, in connection 
with or relating to alcoholic beverages or the 
publicizing of alcoholic beverages by brand 
name, manufacturer's name or by other ref- 
erence and shall include any display intended 
to attract attention by a combination of let- 
ters, pictures, objects, lighting effects, illus- 
trations, etc., except that such term shall not 
include: 

(a) any label affixed to any container of alco- 
holic beverages or any individual covering, 
carton or other wrapper of the container; 
or 

(b) any editorial for which no money or other 
valuable consideration is paid or prom- 
ised, directly or indirectly, by any person 
subject to these Rules. 

(3) "Cooperative advertising" means any joint 
effort between permittees occupying a verti- 
cal relationship to each other to advertise 
alcoholic beverages, the retailer's business, 
or any promotion as defined in 4 NCAC 2T 
.071)2(3) of this Chapter. Cooperative ad- 
vertising, however, shall not be construed to 
include point-of-sale advertising furnished 
by a manufacturer, wholesaler ef importer. 
an industry member. 

(4) "Direct Mail" means anv advertising mate- 
rial mailed via anv class of postal service t£ 
a consumer. 

(5) f-b> "Display" means the exhibition of alco- 
holic beverage containers in cases, or bottles 
or cans outside of cases, together with ad- 
vertising material, the purpose of which is to 



1 682 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



advertise those products to prospective pur- 
chasers on the premises. 

(6) (5) "Case display" means alcoholic 
beverages in cartons or cases only. A 
handypack is included in the term "carton." 

(7) {6} "Magazine" means any trade, fraternal 
or scientific periodical or a periodical having 
general circulation and containing descrip- 
tive matter, articles and stories, and designed 
primarily for the edification and enter- 
tainment of the reader that is published no 
less frequently than once each quarter. 

(8) f?} "Newspaper" means any paper published 
more frequently than once monthly. a»a 
having a paid- circulation. 

(9) (&)■ "Point-of-Sale" means advertising that 
is located inside and on the premises where 
the product is displayed or sold. Point-of- 
sale materials do not include consumer or 
retailer specialty items or novelties. 

Statutory Authority G.S. !8B-I05(b). 
.1004 GENERAL PROVISIONS 

/ o \ \ T f-t <-..-n-«Ti.<-ti-i/^ At wn.^i It r ««-u-l< c adi ' ' ajj * n **^ i j an 
^;^r t^^^t r-^- 1 1 1 j_i 1 1 \j\j ^ OTTvrnTj li i\s u \jv iit ui rnrnTTCrT 

a» affiliate, shall publioh, disseminat e ©f broad 
©ast- ©* oauoo to be publish e d, dissominatod ©f 
broadcast i» a«y nowopapor, free nowspapor, 
magazine, shopping guid e ©f similar publication 
Bf a»y medium ©f advorticing, any advertisement 
©£ alcoholic bovoragoo unloss that- adv e rtis e m e nt 
is » conformity with thooo P<.ulos. 

(©) Advorticing. It- is the policy ©f the Com 
mission that these R.uIos shall apply to all advor 
tising modia ongagod m interstate ©f intrastato 
commoroo. 

(a) Advertising Permitted Und e r Conditions 
Specified. Advertising will- be p e rmitt e d through 
the modia ©f newspapers, magazines, billboards, 
signs, radio aa4 t e l e vision, ©f as otherwise - spe- 
cifically provided ©f approved by the Commis 

£~ i r\r\ in/' 4 V-. f\rt l i -n H j-t -r- 4 t% fi fnnilitinni- r»/-t + rMit | » -l 4 tt 1 l- 
U1U 1 1 CTTTCT CXIDXJ HI 1UU1 1 1 1U UUUUlllUllJ L^J I UTJC ITT TTOT7 

Rul e . The Commission does F*©t waivo the d+s- 
cr e tion conf e rred upon it- under G.S. 18B 105 to 
prohibit a«y advertising that it- considers 
objoctionablo ©f contrary to public interest. 

(a) Ne person shall originato advertising m this 
Stato dealing with alcoholic bovoragoo by any 
means including newspapers, radio, television, 
circulars, signs, billboards, displays ©f a»y oth e r 

L4.U- I Ul I CT7CCXC 111L U LU , Ul 11 L. .' J -J Ul'll U U I I 1 U 3C 1 1 LL'lll ITT 111 

conformity with all provisions ©f thes e Rules. 

(a) AH alcoholic bovoragoo adv e rtising ©f any 
claims £©f alcoholic bovoragos advertising shall 
conform with the standards set forth m rogu 
lationo under the provisions ©f the Federal Mco 
holic Administration Aat- except whore they 
conflict with the rulos af the Commission. 



(a) Compliance with Rules. No permittee or 
affiliate shall publish, disseminate or broadcast, 
or cause to be published, disseminated or broad- 
cast, any advertisement, either directly or indi- 
rectly, by newspaper, magazine, shopping guide, 
sign, circular, direct mail, billboard, display, ra- 
dio, television or other advertising medium unless 
the advertisement is in conformity with all the 
rules of the Commission. This requirement shall 
apply to any alcoholic beverage advertising, 
whether or not it originates within this state. In 
addition, the Commission does not hereby waive 
the discretion conferred upon it under G.S. 
18B-105 to prohibit any advertising that it con- 
siders objectionable or contrary to public inter- 
est. 

(b) Trade Practice Section Applies. In addition 
to the rules in this Section, industry members 
shall comply with the trade practice and adver- 
tising requirements of Section .0700 of Subchap- 
ter 2T of this Chapter in their dealings with 
retailers and special one-time permittees. 

(c) Approval of Advertising Not Authorized. 
Upon request and for good cause shown, the 
Commission may authorize a form of advertising 
not specifically allowed or authorized by these 
Rules. 

(d) (f) Limited to Brands Listed. Advertise- 
ments of alcoholic beverages shall be limited to 
the brands actually approved and listed by the 
Commission at the time the advertisements ap- 
pear. 

(e) (§) Telephone Directory Listings. 
Permittees may insert telephone and city direc- 
tory listings if the listings conform in copy to the 
restrictions enumerated in these Rules. 

(f) fh) Advertising within Transportation Ter- 
minals. Upon application, the Commission may 
allow a permittee to advertise alcoholic beverages 
within transportation terminals by displays or 
otherwise. 

(g) (i) Exchange of Advertising by Permittee. 
Any retail permittee of the Commission may give 
to any other retail permittee of the Commission 
any advertising matt e r that has ft©- ©se other thaa- 
advertising material if it meets the requirements 
of these Rules. 

Statutory Authority G.S. 1SB-I05(b). 

.1005 PROHIBITED STATEMENTS IN 
ADVERTISING OR ON LABELS 

(a) General Restrictions. An advertisement or 
product label shall not contain: 

(1) any statement, design, device or repre- 
sentation that is false or misleading in any 
material particular; 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



16S3 



PROPOSED RULES 



(2) any statement that is disparaging of a 
competitor's products; 

(3) any statement, design, device or repre- 
sentation which depicts nudity or is ob- 
scene or indecent; 

(4) any statement, design, device or repre- 
sentation of or relating to analysis, stand- 
ards or tests, irrespective of falsity, which 
is likely to mislead the consumer; 

(5) any statement, design, device or repre- 
sentation of or relating to any guaranty, 
irrespective of falsity, which is likely to 
mislead the consumer. Nothing in this 
Section shall prohibit the use of an en- 
forceable guaranty in substantially the 
following form: "We will refund the pur- 
chase price to the purchaser if he is in any 
manner dissatisfied with the contents of 
this package"; 

(6) any statement that the product is 
produced, blended, made, bottled, packed 
or sold under or in accordance with any 
authorization, law or regulation of any 
municipality, county or state, federal or 
foreign government, unless such statement 
is required or specifically authorized by 
the laws or regulations of such govern- 
ment; and if a municipal, county, state or 
federal permit number is stated, such per- 
mit number shall not be accompanied by 
any additional statement relating thereto; 

(7) any statement, picture or illustration im- 
plying that the consumption of alcoholic 
beverages enhances athletic prowess, or 
any statement, picture or illustration re- 
ferring to any known athlete, if such 
statement, picture or illustration implies, 
or if the reader may reasonably infer, that 
the use of this product contributed to such 
athlete's athletic achievements; 

(8) any picture or illustration depicting the 
use of alcoholic beverages in a scene 
which is undignified, immodest or in bad 
taste; 

(9) any offer of a prize or award upon the 
completion of any contest in winch there 
is a requirement to purchase the adver- 
tised product, provided that, no advertise- 
ment shall promote a game of chance or 
a lottery'; ef the awarding &£ pria i jo ©f 
premiums; 

(10) any subject matter or illustrations induc- 
ing minors persons under 21 years of age 
to dnnk; 

(11) any statement, picture or illustration in- 
consistent with the spirit of safety or safe 
driving programs; 



(12) any scene that would be contrary to state 
laws and rules governing sale, storage and 
consumption of alcoholic beverages; 

(13) any statement concerning a brand that is 
inconsistent with any statement on the 
labeling thereof; 

(14) any statement, design or device repres- 
enting that the use of a brand has curative 
or therapeutic effects, if such statement is 
untrue in any particular, or tends to create 
a misleading impression; 

(15) any statement or representation that the 
product was manufactured in or imported 
from a place or country other than that 
of the actual origin, or was produced or 
processed by one who was not in fact the 
actual producer or processor; 

(16) any statement, design, device or pictorial 
representation of or relating to or capable 
of being construed as relating to the armed 
forces of the United States or the Ameri- 
can Flag, state flag, or any emblem, seal, 
insignia or decoration associated with any 
such flag of armed forces of the United 
States; nor shall any advertisement con- 
tain any statement, device, design or pic- 
torial representation of or concerning any 
flag, seal, coat of arms, crest or other 
insignia, likely to mislead the consumer 
into believing that the product has been 
endorsed, made or used by, produced for 
or under the supervision of or in accord- 
ance with the specifications of the gov- 
ernment, organizations, family or 
individual with whom the flag, seal, coat 
of arms, crest or insignia is associated; or 

(17) words such as "high test," "high proof," 
"full strength," "extra strong," or similar 
descriptive terms, or direct or indirect ref- 
erences to the intoxicating effect of the 
product. 

(b) Prohibited Statements in Regard to Wine. 
In addition to the applicable prohibited state- 
ments as set forth in Paragraph (a) of this Rule, 
an advertisement or label for wine shall not con- 
tain: 

(1) any statement of bonded winecellar and 
bonded winery numbers unless stated in 
direct conjunction with the name and ad- 
dress of the person operating such winery 
or storeroom. Statement of bonded 
winecellar and bonded winery numbers 
may be made in the following form: 

"Bonded Winecellar No. ," "B.W.C. 

No. ." 

"Bonded Winery No. ," "B.W. No. 



1684 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



No additional reference thereto shall be 
made, nor shall any use be made of such 
statement that may convey the impression 
that the wine has been made or matured 
under United States Government or any 
state government supervision or in ac- 
cordance with United States Government 
or any state government specifications or 
standards; 

(2) any statement, design or representation 
which relates to alcoholic content or 
which tends to create the impression that 
a wine is "unfortified" or has been "forti- 
fied" or has intoxicating qualities, or con- 
tains spirituous liquors liquor (except for 
a reference to spirituous liquors liquor in 
a statement of composition where such 
statement is required by these Regulations 
Rules to appear as part of the designation 
of the product); or 

(3) statement of age or dates, or any statement 
of age or representation relative to age 
(including words or devices in any brand 
name or trademark), except that: 

(A) In the case of vintage wine, the year of 
vintage may be stated if it appears on the 
label; or 

(B) Truthful references of a general and in- 
formative nature relating to methods of 
production involving storage or aging, 
such as "This wine has been mellowed in 
oak casks," "Stored in small barrels" or 
"Matured at regulated temperatures in our 
cellars" may be made. 

The statement of any bottling date shall 
not be deemed to be representation relative 
to age, if such statement appears without 
undue emphasis in the following form: 

"Bottled in " (inserting the year in 

which the wine was bottled). No date, ex- 
cept as provided in this Section with re- 
spect to statement of vintage year and 
bottling date, shall be stated unless, in ad- 
dition thereto and in direct conjunction 
therewith, in the same size and kind of 
printing there shall be stated an explanation 
of the significance of such date. Provided, 
that if any date refers to the date of estab- 
lishment of any business, firm or corpo- 
ration such date shall be stated without 
undue emphasis and in direct conjunction 
with the name of the person, firm or cor- 
poration to whom it refers, 
(c) Prohibited Statements in Regard to 
Spirituous Liquors. Liquor. In addition to the 
applicable prohibited statements in Paragraph (a) 
of this Rule, an advertisement for spirituous liq- 
uet liquor shall not contain: 



(1) words "bond," "bonded," etc; any state- 
ment containing the words "bond," 
"bonded," or "bottled in bond," "aged in 
bond" or phrases containing these or 
synonymous terms, unless such words or 
phrases appear upon the labels of the 
spirituous liquors liquor advertised, and 
are stated in the advertisement in the 
manner and form in which they appear 
upon the label; 

(2) statements of age; any statement, design 
or device directly or by implication con- 
cerning age or maturity of any brand or 
lot of spirituous liquors liquor unless a 
statement of age appears on the labels of 
the advertised product; When any such 
statement, design or device concerning age 
or maturity is contained in any advertise- 
ment, it shall include, in direct conjunc- 
tion therewith and with substantially 
equal conspicuousness, all parts of the 
statement concerning age and percentages, 
if any, which appear on the label. How- 
ever, an advertisement for any whiskey or 
brandy which does not bear a statement 
of age on the label, or an advertisement 
for rum which is four years or more old, 
may contain general inconspicuous age, 
maturity or other similar representation, 
e.g., "aged in wood," "mellowed in fme 
oak casks"; 

(3) the word "pure" except as part of the bona 
fide name of a permittee; or 

(4) the terms "double distilled," "triple dis- 
tilled" or any other similar term. 

Statutory Authority G.S. 18B-105(b). 

.1006 GENERAL PROHIBITIONS 

(a) Cents-off coupons or coupons offering free 
alcoholic beverages shall not be used as a method 
for advertising, alcoholic bovoragos. 

(b) No alcoholic beverages advertising shall be 
carried in any programs for events or activities in 
connection with any elementary or secondary 
schools; nor shall any alcoholic beverages adver- 
tising be connected with these events when 
broadcast over radio or television. 

(c) No alcoholic beverages advertising shall be 
permitted by use of sound trucks. 

(d) No spirituous liquor advertising shall be 
displayed upon the picture screen of any theater. 

(e) N» Except as otherwise provided in these 
Rules, no industry member or retailer shall pro- 
mote h» an alcoholic beverage product by giving 
prizes, premiums or merchandise to individuals 
for which any purchase of alcoholic beverages is 
required or- based on the return of empty con- 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



16S5 



PROPOSED RULES 



tainers unless all containers of like products are 
accepted and considered on an equal basis with 
the product sold by the promoter. 

(f) No on-premise permittee or his agent shall 
advertise any drink promotion prohibited by 
Rule 2S .0232. This Paragraph includes a ban 
on all advertisements of "2 for 1," "buy 1 get 1 

free," "buy 1 get another for a (nickle, 

penny, etc.)," and any other similar statement 
indicating that a patron must buy more than one 
drink. 

Statutory Authority G.S. 1 SB- 105(b). 

.1007 COOPERATIVE ADVERTISING 
PROHIBITED 

Thoro shall he »» cooperatives advertising as he- 
twoon a retailor e» the e»e hand asa a» industry 
mombor ©«• the othor hand. 

Except for point-of-sale advertising furnished to 
a retailer by an industry member, a retailer and 
an industry member shall not directly or indi- 
rectly cooperate in a joint effort to advertise al- 
coholic beverages, the retailer's business, or any 
promotion or other event unless prior written 
approval has been obtained from the Commis- 
sion under 4 NCAC 2T .0717 of this Chapter. 
This Rule shall not be construed to prohibit the 
use bv a retailer of items and services that may 



be lawfully sold or provided bv an industry 
member as described in 4 NCAC 2T .0700 of this 
Chapter. 

Statutory Authority G.S. 1 8 B- 105(b). 

.1008 ADVERTISING OF MALT BEVERAGES 
AND WINE BY RETAILERS 

(a) Interior Advertising. 

(1) Point-of-Sale. Retail malt be%'erage and 
wine permittees may utilize any amount 
of point-of-sale advertising for malt 
beverage and wine products offered for 
sale in the establishment. This advertise 
mont advertising may be supplied by the 
manufacturer, importer e* wholesaler in- 
dustry 7 member unless it constitutes a fix- 
ture or has value other than as advertising 
material; except that an industry member 
may give a retailer brand-identified items 
listed in 4 NCAC 2T .0713(c) of this 
Chapter for use as point-of-sale advertis- 
ing. 

(2) Price Boards. Retail malt beverage and 
wine permittees may display inside price 
boards showing the brand names and 
prices of malt beverage and wine products 
offered for sale in the establishment. 



(3) Menus and Beverage Lists. Retail on- 
premise malt beverage and wine 
permittees may place on the menu and 
beverage lists the brand names and prices 
of malt beverage and wine products of- 
fered for sale in the establishment. Menus 
and beverage lists may be supplied by a 
malt beverag e e* wine manufacturer, 
import e r ef wholesaler an industry mem- 
ber provided »& industry member's trad e 
namo »f logo » duplicated &» the fotr the 
menu or beverage list is not printed with 
the retailer's food menu. 

(4) Retailer Advertising Specialty Items. 
Retailer advertising specialty items are 
items such as trays, coasters, mats, meal 
checks, paper napkins, glassware, cups, 
foam scrapers, back bar mats, 
thermometers and other similar items that 
bear advertising matter. a»a that are net 
primarily valuabl e te the retail e r a* point 
of sale advertising media. Retailor advor 
tising Advertising specialty items may be 
used provided those items a*e purchased. 
to a retailer by an industry member as 
provided in 4 NCAC 2T .0713(b)(8) of 
this Chapter. 

(5) Window Displays. Retail malt beverage 
and wine permittees may arrange a rea- 
sonable number of malt beverage or wine 
products in a window display. 

(6) Location. No point-of-sale advertising, 
advertising specialty item or price board 
shall be displayed in a manner designed 
or intended to advertise malt beverages or 
wine on the outside of the establishment. 

(7) T-shirts. A retailer's employees shall not 
wear alcoholic beverage brand identified 
t-shirts while working on the retailer's IT 
censed premises. 

(8) p) Removal of Objectionable Signs. A 

permittee shall remove any sign, display 
or advertisement in or about his licensed 
premises if the Commission finds it is 
objectionable or contrary to public inter- 
est and orders its removal, 
(b) Exterior Advertising. 
(1) Outside signs on the premises. 

(A) Malt Beverages. Retail malt beverage 
permittees may display the term "beer" 
or "cold beer" or "draught beer" on a 
single, non-mechanical outside sign. The 
letters and figures on the sign shall not be 
more than 5 inches in height and 2 inches 
apart and the sign shall be attached to the 
building on the licensed premises. 

(B) Wine. Retail wine permittees may dis- 
play the term "wine permit-off premise" 






1686 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



approved by the Commission. Advortioing e£ 
opirituous liquors is prohibitod » ABC storoo, 
oxcopt that a display ease m*y- be uood to show 
»U brands carriod i» the sturo »h4 dolistod codes 
may be prominontly displayed indicating a pric e 
roduction. 

(b) Aerial Displays. No distiller, importer, or 
rectifier of spirituous liquor, or representative 
thereof, nor any retail permittee, shall advertise 
by means of an aerial display or inflatable the 
brand name or availability of spirituous liquor. 

(c) Billboards. No distiller, importer, or 
rectifier of spirituous liquor, or representative 
thereof, nor any retail permittee, shall advertise 
by means of a billboard or sign the brand name 
or availability of spirituous liquor. 

(d) Broadcasting. No distiller, importer, &f 
roctifior »f spirituous liquor, ef representative) 
thoroof, Hef »»y retail permittee shall advertise 
by radio or television or any transmission to ra- 
dio or television the brand name or availability 
of spirituous liquor. 

(e) Point-of-Sale. Point-of-sale and advertising 
specialties for spirituous liquor shall ftet- may be 
used in ABC stores »e* but not in retail estab- 
lishments holding permits issued by the Com- 
mission. Advertising used in ABC stores shall 
conform to the provisions of Rule .1005 of this 
Section, and in addition shall not: 

(1) incorporate the use of any present or for- 
mer athlete or athletic team; 

(2) refer to the availability of or oflcr any al- 
coholic beverages by mail; or 

(3) utilize case card loaders. 

All point-of-sale advertising material, advertising 
specialties, and recipes, booklets or brochures 
intended for use and display in ABC stores shall 
first be submitted to the Commission for ap- 
proval prior to their display in an ABC store. 

Statutory Authority G.S. 1SB-105. 

.1012 NOVELTIES UTILIZING TRADEMARKS 
/NAMES: OTHER MATERIALS 

Industry members may use or allow to be used 
their trademark, trade name or other similar ad- 
vertising materials in the manufacturing of nov- 
elty items such as glasses, ice chests, beach 
towels, T shirts, umbrellas, and other similar 
items provided that any advertising material 
other than trade name or trademark shall receive 
approval by the Commission prior to distrib- 
ution in North Carolina. Novelties may be sold 
to a retailer by an industry member as provided 
in 4 NCAC 2T .0713(a)(1) of this Chapter. 

Statutory Authority G.S. I8B-I05(b). 



.1014 RECIPES AND BOOKLETS 

Recipes, booklets and brochures for cooking 
with alcoholic beverages and information with 
reference to the use of certain alcoholic beverages 
those products with certain foods are permitted 
and may specify the brand and the name of 
winery, the bottler, ©f manufacturer or importer- 
Malt beverage and wine industry members may 
.give recipes, booklets and brochures for cooking 
with those products to retailers. Recipes, book- 
lets and brochures for cooking with spirituous 
liquor shall be submitted to the Commission 
with point-of-sale materials as required in Rule 
.1011(e) of this Section. 

Statutory Authority G.S. 18B-I05(b). 

.1020 REFUND OFFERS 

(a) General. Refund offers may be used to 
advertise spirituous liquor and wine. 

(b) Conditions. A refund offer is an offer to a 
consumer for a rebate of money or merchandise 
from a liquor or wine industry member, obtained 
by mailing a form. A refund offer is allowed 
under the following conditions: 

(1) A refund for liquor may be offered only 
by a manufacturer, importer, distiller, 
rectifier or bottler of spirituous liquor. A 
refund for wine may be offered only by a 
manufacturer, bottler, importer or non- 
resident vendor of wine. 

(2) A refund may be offered only to purchas- 
ers of the manufacturer's original uno- 
pened container of liquor that is 
purchased from a local ABC store, or to 
purchasers of the manufacturer's original 
unopened container of wine that is pur- 
chased from a retail wine permittee or lo- 
cal ABC store. 

(3) A refund may be offered only when the 
redemption form is a part of or attached 
to the package or container, or when the 
forms are available on tear-off pads dis- 
played in the store. Any offer that is a 
part of or attached to the package or 
container shall be placed there by the in- 
dustry member who offers the refund. 

(4) A refund offer shall apply throughout the 
state. 

(5) A refund offer shall include an expiration 
date. 

(6) A refund offer shall include a statement 
explaining the redemption procedure in- 
cluding the expiration date and length of 
time before the refund is sent to the pur- 
chaser. Refund offers shall be redeemed 
by mailing the redemption form to the 
industry member who offers the refund 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1689 



PROPOSED RULES 



or its designated redemption agent. Such 
an agent shall not be a retail or wholesale 
permittee in the state. 

(7) An industry member shall notify the 
Commission at least 10 days before it of- 
fers a refund on liquor. The notice shall 
state the proposed amount of the refund, 
its expiration date, to whom redemption 
forms must be mailed and the name, ad- 
dress and phone number of the redemp- 
tion agent. The notice shall also include 
a sample of the redemption form. 

(8) An ABC board member, &? board em- 
ployee, retailer or retailer employee shall 
not receive refunds on offers obtained 
from liquor or wine packages or contain- 
ers before sale at retail. 

(c) Commercial bribery; cooporativo adv e rtir . 
iftgr Bribery; Cooperative Advertising. No retail 
permittee - , local ABC board member, e* board 
employee, retailer or retailer employee shall ac- 
cept and no industry member shall pay any fee 
for the display or use of refund offers. The name 
of a retail business or retail permittee shall not 
appear on any refund offer. 

(d) Advertising refund offcro. Refund Offers. 
Refund offers may be advertised by newspapers, 
magazines or direct mail but no redemption form 
may appear in such advertisement. No refund 
offer for liquor may be advertised on the premises 
of any retail permittee. 

Statutory Authority G.S. 18B-I05(b). 

SECTION .1 100 - EFFECT OF 

ADMINISTRATIVE ACTION: FINES: OFFERS 

IN COMPROMISE 

.1101 PROHIBITED ACTIVITY DURING 
PERIOD OF SUSPENSION 

(a) The selling, dispensing or consuming of al- 
coholic beverage products on the licensed prem- 
ises of any retail outlet is prohibited while the 
permit authorizing that activity is under suspen- 
sion, fie* r . hall afiy and no alcoholic beverages 
shall be removed from the premises during the 
suspension period. 

(b) During a period of suspension of a 
permittee's permit, he continues to be a permittee 
and shall comply with all ABC laws, including 
conditions of his permit, during the suspension 
period. Suspension of permits does not operate 
to relieve any permittee of the continuing re- 
quirements for qualification for a permit. 

(c) The suspension of any permit authorizing 
the sale of alcoholic beverages also suspends the 
permittee's authorization to purchase or accept 
deliveries of those alcoholic beverages from a 



wholesaler or local ABC board for the entire 
length of the active suspension period. 

(d) Suspensions shall begin at 7:00 a.m. on the 
effective date ordered bv the Commission in the 
Order of Suspension or Order of Compromise. 



Statutory Authority G.S. 
1SB-I004(a); 18B-1008. 



103 



18B-104; I8B-207; 



MEMBERSHIP REQUIREMENTS 
STIUL APPLICABLE 

A permittee holding a Brownbagging ef Mixed 
Beveragoo Permit as a private ek*e shall continue 

t f\ Qfl r-i-1 T-vl t : II if K Q I 1 «-. i.-ii 1 « rrxrri rifiti- ^^L U^A ,^L^h^_ Li^^X^^ 

r e garding membership afi4 operation »f the 
buLiinoGO as a private facility. 

Suspension of a private club permit does not 
operate to relieve the permittee of the continuing 
requirements for qualification for a private club 
permit, including requirements regarding mem- 
bership and operation as a private facility. 

Statutory Authority G.S. 18B-207: 18B-/008. 

SUBCHAPTER 2T - INDUSTRY MEMBERS: 
RETAIL/INDUSTRY MEMBER 

RELATIONSHIPS: SHIP CHANDLERS: AIR 
CARRIERS: FUEL ALCOFIOL 

SECTION .0100 - DEFINITIONS: APPLICATION 
PROCEDURES 

.0101 DEFINITIONS 

The following terms shall have the following 
meanings when used in this Subchapter: Chap- 
ter: 

( 1 ) "Brand," in relation to wines, means the 
name under which a wine is produced and 
shall include trade names or trademarks. A 
brand shall not be construed to mean a class 
or type of wine, but all classes and types of 
wines sold under the same brand label shall 
be considered a single brand. Differences in 
packaging such as a different style, type or 
size of container are not considered different 
brands. 

(2) 'industn' member" means anv wholesaler, 
salesman, brewery, winery, bottler, importer, 
distiller, rectifier, nonresident vendor, vendor 
representative, or affiliate thereof, that sells 
or solicits orders for alcoholic beverages, 
whether or not licensed in this state. 



(3) "Retail permittee" or "retailer" means anv 
permittee holding a retail alcoholic beverage 
permit issued pursuant to the authority of 
G.S. 18B-1001. but shall not include a non- 
profit or political organization that has been 
issued a Special One-Time permit pursuant 



1690 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



to the provisions of G.S. 18B- 1002(a)(2) or 

(51 

(4) fty "Representative" means any vendor 
representative, as that term is defined in G. 
S. 18B-1112, or any other person selling or 
soliciting orders for alcoholic beverages on 
behalf of a manufacturer, bottler, e* vendor, 
or importer. 

(5) f3} "Vendor" means any nonresident malt 
beverage vendor or nonresident wine ven- 
dor, as those terms are defined in G.S. 
18B-1113 and 18B-1114. 

(6) f3} "Wine" means both fortified wine and 
unfortified wine, as those terms are denned 
in G.S. 18B-101(7)and(15). 

Statutory Authority G.S. 18B-101; 18B-207; 
18B-1I12; 18B-/J/3; 18B-I114. 

SECTION .0200 - PRODUCT APPROVALS: 
LISTING PROCEDURES: PRODUCT LISTS 

.0201 MALT BEVERAGE PRODUCT 

APPROVALS: LISTING IN STATE 

(a) All malt beverage products offered for sale 
shall first be approved by the Commission. 
Thereafter, any approved malt beverage product 
sold in this State shall conform to the analysis 
of the samples submitted. 

(b) Samples. Any industry member who sub- 
mits to the Commission a malt beverage product 
for approval for sale in the State shall furnish, 
without cost to the Commission, at- loaot 440 
mililitors (15.30 ounces) ©f the a sample of the 
product in twe- a marketable containoro. con- 
tainer. 

(c) Procedure for Listing. To receive consid- 
eration by the Commission for a new malt 
beverage product, an industry member shall 
comply with the following procedures: 

(1) All items shall be submitted in duplicate 
with a list of all container sizes being of- 
fered; 

(2) All labels shall be submitted in duplicate 
and attached to the application form; 

(3) A copy of the Federal Label Approval 
Form shall be submitted; 

(4) Payment of a non-refundable analysis fee 
in the amount of twenty-five dollars 
($25.00) shall accompany the application 
of each new item submitted; except if the 
industry members member submits a cer- 
tified laboratory analysis of the product, 
payment of a non-refundable administra- 
tive fee in the amount of ten dollars 
($10.00) shall be submitted. 



(d) If an analysis of a product is submitted it 
shall provide at least the following information 
in English: 

(1) alcohol by volume (maximum six per- 
cent), 

(2) total sulphur dioxide content (maximum 
25 ppm), 

(3) gallo-tannins (maximum 100 ppm), 

(4) calories per 360 milliliters ( 12 ounces), and 

(5) specific gravity. 

(e) All forms required for the listing, analysis 
and approval of any malt beverage product shall 
be stapled together and forwarded to the ABC 
Commission, 3322 Garner Road, P.O. Box 
26687, Raleigh, North Carolina 27611-6687. 

Statutory Authority G.S. 18B-206; 18B-207. 

.0202 WINE APPROVALS: LISTING IN 
STATE 

(a) Except as provided for special orders, before 
any wine is offered for sale in this State, it and the 
label used upon the container shall first be ap- 
proved by the Commission. The Commission 
shall provide blank Wine Analysis forms upon 
request. Thereafter, any approved wine sold 
shall conform to the analysis of the samples 
submitted. 

(b) Sample of Wine Required. An industry 
member shall submit, without cost to the Com- 
mission, a sample of any wine that is the subject 
of application for listing for inspection and anal- 
ysis. 

(c) The steps required to receive consideration 
by the Commission for a new wine listing are: 

(1) submit all items on the form in duplicate, 
fortified and unfortified wines listed on 
separate forms; 

(2) submit all labels in duplicate attached to 
the form; 

(3) submit a 500 milliliter (or a larger size if 
500 milliliter is not available) bottle of 
each product offered for examination; 

(4) list all sizes being offered on the form; 

(5) submit a copy of the Federal Label Ap- 
proval; 

I f-J\ c i l Ktvi 1 1 f\ i"\ t 1 .-i i ■ . ■ t l-\ ■ i t-i • i "\.i 1 1 I ti -l i 1 1 ■ 1 « t ■ \w i- -i in i> 1 . * 

i \j f juuiiui nu l i \~' ._' J 1 1 in 1 1 cr _' '_' i,i 1 1 mini t v*r -in 1 1 1 ' iu 

»f brandy «*?4 te fortify aw fortified 
wines; 

(6) £?) submit a check in the amount of 
twenty-five dollars ($25.00) for each new 
item submitted, except if a verified labo- 
ratory analysis of the product is submit- 
ted, a check in the amount of ten dollars 
($10.00); 

(7) (&) staple together all forms submitted with 

each item and forward to the North 
Carolina Alcoholic Beverage Control 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1691 



PROPOSED RULES 



Commission, 3322 Garner Road, P.O. 

Box 26687, Raleigh, North Carolina 

27611-6687. 
(d) If an analysis of a product is submitted, it 
shall provide at least the following information 
in Fnglish: 

(1) alcohol by volume (percent); 

(2) total acidity (g/ 100 cc as tartaric acid); 

(3) total sulphur dioxide content (ppm); 

(4) volatile acidity, exclusive of sulphur 
dioxide (g/ 100 cc as acetic acid); 

(5) alcohol-free soluble solids (degrees/ Brix 
degrees/ Balling); and 

(6) identity and quantity of any added chemi- 
cal preservative. 

Statutory Authority G.S. 1 SB- 206; 18B-207. 

.0203 SPIRITUOUS LIQUOR PRODUCT 
APPROVALS 

(a) All brands of spirituous liquors liquor sold 
in this State shall have first been approved for 
listing and resale by the Commission. 

(b) Listing Policy. In view of the fact that 
North Carolina is a monopoly state, the Com- 
mission is responsible for maintaining a wide 
range of spirituous liquor products and prices 
and a balanced selection between the various 
types of products. It is the Commission's re- 
sponsibility to insure ensure that the various 
types of products, including specialty items and 
imports, are available to the North Carolina 
consumer, as well as the more popular products. 
To this end, the Commission shall, at least once 
a year, consider new spirituous liquor products 
for placement on the state's approved list. 
Listings shall be in the discretion of the Com- 
mission after considering sales trends of the type 
of product, sales trends of the product in other 
states, and the need for the product in the North 
Carolina market. The Commission shall also, 
at least once a year, consider delisting items from 
the approved list. Items maintaining adequate 
sales histories for type and price range will not 
be considered for delisting unless the delisting is 
part of a penalty invoked after hearing, pursuant 
to this Chapter. 

(c) Items shall be submitted to the Commission 
for consideration for listing, and will be consid- 
ered only if they are offered on the prescribed 
forms by the distiller, rectifier, bottler or 
importer, with tl*e following warranty sign e d by 
aft official e4 tke distill e r, rectifier, bottlor e* 
importor: 

^44- is hereby warrant e d that tfte ease pric e s 
as shown hero on represent tbe lowest 
taxpaid LOB. distillery ftrte ef point ef fiftal 
shipment Fate off e red any- purchas e rs fof tke 



same merchandise an4 tftat- tft» freight as 
shown hereon does »»*■ oxcood the ee&t e£ 
delivery ef- this merchandise t» North 
Carolina." 

Statutory Authority G.S. I8B-206; 18B-207. 

.0206 NEW FILING REQUIRED UPON 
TRANSFER OF BRAND 

When any malt beverage or wine brand or 
product is transferred from one nonresident ven- 
dor, manufacturer or importer to another, the 
new vendor, manufacturer or importer shall, 
within 30 days of the acquisition of the brand or 
product, submit the following items to the 
Commission: 



( 1 ) label approval application forms (BWL008) 
in duplicate, with labels attached; 

(2) copies of Federal Label Approval forms in 
duplicate; 

(3) a certified laboratory analysis of the prod- 
uct, in Hnglish, showing alcohol content by 
volume, with a check in the amount of ten 
dollars ( $10.00"]; and 

(4) the wholesaler territorial designations for 
the brand and product that were in effect on 
the date the product was acquired by the 
vendor, manufacturer or importer. 

Compliance with this Rule is mandatory 
notwithstanding the fact that the product has 
been previously approved by the Commission. 

Statutory Authority G.S. 18B-203(a); 18B-206; 
18B-1203; 18B-1303(a); 18B-1305(d). 

SECTION .0400 - STANDARDS OF IDENTITY 
FOR WINE: CONTAINERS 

.0401 APPLICATION OF STANDARDS 

All wines produced, imported, bottled, or of- 
fered for sale in this State shall meet the standards 
of identity prescribed as of February 4-? 198'1, 
April L 1986, in Subpart C, Part 4, Chapter 1, 
Title 27 of the Code of Federal Regulations. 
The Commission has a copy of those regu- 
lations available for inspection at the address in 
this Rule. Copies are available at a cost of te» 
cents ($ t+04 twenty-five cents ($0.25) per page. 
North Carolina ABC Commission 
3322 Garner Road 
P. O. Box 26687 
Raleigh, N. C. 27611-6687 

Authority G.S. 18B-206(a); 18B-207; 27 C.F.R. 
4.20 through 27 C.F.R. 4.27. 

.0409 PROHIBITED PRACTICES 

(a) The production, importation or sale within 
this State of any product as or under the desig- 



1692 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 






nation of wine that fails to conform to the 
standards prescribed in these Rules, e? ef- a«y 
win e formontod from raisins, dried fruits ef driod 
berries, or of any imitation or substandard wine 
is prohibited. 

(b) Imitation Wine. Imitation wine includes: 

(1) any wine containing synthetic materials; 

(2) any wine made from a mixture of water 
with residues remaining after thorough 
pressing of grapes, fruit or other agricul- 
tural products; 

(3) any class or type of wine, the taste, aroma, 
color or other characteristics of which 
have been acquired in whole or in part by 
treatment with methods or materials of 
any kind, if the taste, aroma, color or 
other characteristics of normal wines of a 
any such class or type are acquired with- 
out that treatment; or 

(4) any wine made from must concentrated 
at any time to more than 80 degrees 
(Balling). &f 

($) frui* win a fiet- dorivod wholly from »«e 
lcind ef few* such as "berry wino," "oitruo 
wino" e* "citrus frwt wino." 

(c) Substandard wine includes: 

(1) any wine having a volatile acidity in excess 
of the maximum prescribed therefor in 
these Rules; 

(2) any wine for which no maximum volatile 
acidity is prescribed in these Rules having 
a volatile acidity, calculated as acetic acid 
and exclusive of sulphur dioxide, in excess 
of 0. 14 gram per 100 cubic centimeters (20 
degrees Centigrade); 

(3) any wine for which a standard of identity 
is prescribed in these Rules that through 
disease, decomposition or otherwise fails 
to have the composition, color and clean 
vinous taste and aroma of normal wines 
confonning to that standard; 

(4) wine of any class or type containing added 
water or a sugar and water solution in ex- 
cess of the quantities expressly authorized 
for standard wine made from the same 
kind or kinds of materials as prescribed in 
these Rules; 

(5) any wine containing monochloracetic acid 
or any other substance or preservative 
prohibited by the United States Food and 
Drug Administration or the Federal Al- 
coholic Tax Unit; or 

(6) any wine containing deleterious, harmful 
or impure substances or elements or an 
improper balance of elements. 

(d) Coined Names 

(1) Mixture of Wines. The sale in this State 
of wines identified on labels or in adver- 



tisements by a type or brand designation 
that implies mixtures of wines for which 
standards of identity are established in 
these Rules, or which identifying type or 
brand designation resembles an estab- 
lished wine type name such as 
"Angelica," "Madeira," "Muscatel," 
"Claret," "Burgundy," etc., is prohibited. 
(2) Combinations of Alcoholic Beverages. 
The sale in this State of wines or combi- 
nations of wine and other alcoholic 
beverages that contain on the labels state- 
ments such as "whiskey wine," "rum and 
wine," "gin and wine," "beer and wine" 
or similar combinations is prohibited. 

Statutory Authority G.S. 18B-206(a); 18B-207. 

SECTION .0500 - INDUSTRY MEMBERS: 
GENERAL PROVISIONS 

.0501 INSPECTION OF PREMISES 

Any storage facility, warehouse or office area 
where malt beverages or wine are stored or man 
ufaoturor manufactured or where records of pur- 
chases, sales or deliveries are maintained shall be 
considered the licensed premises and shall be 
made available for inspection as provided in G.S. 
18B-502. 

Statutory Authority G.S. 18B-207; 18B-502. 

.0502 RECORD KEEPING REQUIREMENTS: 
SALES TICKETS 

(a) In addition to records required to be kept 
by the North Carolina Department of Revenue, 
all industry' members shall maintain on the li- 
censed premises a carbon copy of every original 
sales ticket or receipt that relates to sales of al- 
coholic beverage products, equipment, advertis- 
ing specialty items, or advertising novelties. 

(b) Sales Ticket Required. Wholesalers or their 
salesmen shall, at the time of each sale and de- 
livery 7 of malt beverages or wine to a retailer, 
provide on every retail sales ticket the following 
information: 

(1) date of sale; 

(2) name of establishment; 

(34 retailor's malt beverage a»d win e permit 
number Bf numbers; 

(3) (4) location; 

(4) (4) quantity of each brand of malt 
beverages or wine sold; 

(5) (6) unit price; 

(6) (?} total price; 

(7) {&} amount received; 

(8) f9} invoice number; and 

(9) (4% route, if applicable. 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1693 



PROPOSED RULES 



All sales tickets shall be endorsed at the time of 
sale by the retailer or authorized agent and by the 
wholesaler with the usual signature of each. All 
sales tickets shall be retained by the wholesaler 
for a period of three years and shall be filed al- 
phabetically, by sales route, or chronologically 
bv date of sale. 



(f) A retail permittee who operates multiple 
locations may maintain beer and wine invoices 
at one central location upon written application 
to and approval by the Commission. 

Statutory Authority G.S. 18B-207; 18B-1107; 
18B-II09; I SB- 1303(a). 



Statutory Authority G.S. 18B-207. 

SECTION .0600 - SALES AND DELIVERIES OF 
MALT BEVERAGES AND WINE 

.0602 SALES AND PURCHASE 

RESTRICTIONS: RECORDS 

(a) No wholesaler of malt beverages shall sell 
malt beverages to any person who does not hold 
a retail or wholesale Malt Beverage permit, and 
no wholesaler of wine shall sell any fortified wine 
or unfortified wine to any person who does not 
hold the appropriate retail or wholesale Fortified 
or Unfortified Wine Permit; except, that a 
wholesaler may furnish or sell wine or malt 
beverages to his employees for the sole use of the 
employees. 

(b) No retail malt beverage or wine permittee 
shall purchase those alcoholic beverages from 
anyone other than a licensed wholesaler. 

(c) No malt beverage wholesaler shall sell, ship, 
or distribute any brand of malt beverages to any 
retail permittee located outside the territory de- 
scribed in that wholesaler's distribution agree- 
ment for the product filed pursuant to G.S. 
18B 1109(b). 18B- 1303(a). 

(d) /Ml persons holding retail Malt Beverage 
or Wine Permits shall keep the sales tickets and 
delivery receipts furnished by the wholesaler, 
pursuant to Rule .0502 of this Subchapter, as 
well as all other records of purchases of malt 
beverages and wine, filed separate and apart from 
all other records. Delivery receipts shall set forth 
terms of sale for each separate transaction be- 
tween the retailer and the wholesaler and shall 
include for each separate sale: 

(1) date of sale; 

(2) trade name of retail establishment; 
f^) permit number; 

(31 (4> location; 

(4) (44 quantity of each brand of alcoholic 
beverage sold; 

(5) (4>+ unit price; 

(6) £34 total price; 

(7) (454 amount paid; and 

(8) (9) invoice or receipt number. 

(e) The retailer shall retain for inspection copies 
of all tickets and receipts on the premises for 
three vears. 



.0604 COLLECTION OF AMOUNT OF SALE 

(a) Each wholesaler shall collect the full amount 
of the sale price in cash or bona fide check at the 
time of or prior to delivery of alcoholic beverages 
to a retailer except as provided in this Rule. No 
wholesaler shall extend credit for any period of 
time to any retailer who purchases malt 
beverages or wine from him. 

(b) Collections for sales and deliveries upon 
military' reservations, however, shall not be re- 
quired at the time of the transaction. 

(c) A route salesman may accept one payment 
for all deliveries made bv him on the same day 
to the same permittee if deliveries are made to 
two or more of the permittee's retail premises on 
the same route. Payment in such cases shall be 
collected bv the salesman for all such deliveries 
no later than at the last store account on the 
route. Nothing in this Rule shall be construed 
to authorize a route salesman to collect payment 
from a permittee at an office location unless the 
office is located on the premises where the last 
delivery is made. 

Statutory Authority G.S. 18B-207; 18B-1116. 

.0605 RESTRICTED HOURS ON SALES OR 
DELIVERIES 

■?ve- whol e saler &f his agont »f employee shall 
sett ef deliver any malt bev e rages &f wine to a 
retail permittee during hours when sates ef alco 
holic beveraaoo afe unlawful under G.S. 
18B 100 ' 1(a),(b), &f (€4t 

Statutory Authority G.S. 18B-207; 18B-I004. 

.0607 DRAUGHT MALT BEVERAGE SALES: 
ACCESSORIES: DELIVERIES 

(a) Delivery to Retailer; Consumer. For each 
sale of draught beer, the wholesaler shall trans- 
port the beer to the premises of a licensed retailer. 
There the wholesaler shall collect for the sale, and 
the retailer shall complete and sign his sales 
ticket, writing on it the name of the purchaser 
and the address to which the beer is to be deliv- 
ered. If the purchaser of the draught beer can 
not transport the beer or does not know how to 
set up and tap the beer, he may request that the 
wholesaler assist him. Upon receiving such a 
request, the wholesaler may deliver the beer from 



1694 



6:22 NORTH CAROLINA REGISTER February 1 4, 1992 



PROPOSED RULES 



the retailer's premises to the person and place 
designated and may set it up. 

(b) Assisting Consumer. Upon arrival at the 
designated place of delivery, the wholesaler may 
set up the equipment, tap the keg and test to see 
that it is working properly. The wholesaler may 
pick up his kegs and equipment at any time. 

(c) Tapping Accessories. Hand pumps, carbon 
dioxide cylinders, related gauges, tubs, ice and 
cups may be delivered with the kegs by a whole- 
saler to a consumer. Such accessories may be left 

with a retailer only upon the filling of an order portion of the territory. 
from a retailer who has a specific and current 
order from a consumer, and the kegs and acces- 



distance of the retailer's premises from the 
wholesaler's warehouse, or the sex, race, age, re- 
ligion or national origin of the permittee. 
(b_i Pricing. As used in G.S. 18B- 1303(b), the 
term "service" shall not be construed to prohibit 
a malt beverage wholesaler from reducing the 
price of a product in a portion of his assigned 
territory if the price reduction is made in order 
to meet a competitor's lower prices offered on 
similar categories of malt beverage products (e.g. 
"premium" or "low end" products) in that same 



sories are to be delivered by the retailer or picked 
up by the consumer. Nothing in this Rule shall 
be construed to allow a wholesaler to loan or rent 
tubs or tapping accessories to a retailer for any 
period of time. 

(d) Keg Deposits. Any deposit charged by a 
brewer to a wholesaler for a draught malt 
beverage keg shall be charged to and collected 
from the retailer upon delivery of the keg to the 
retailer. 

Statutory Authority G.S. 18B-207; 18B-1I16. 

.0608 DRAUGHT MALT BEVERAGE 

EQUIPMENT SALES: TERMS OF SALE 

Malt beverage wholosalors may sell draught 
boxoo aed- equipment te retail malt beverage 

^u£^^Li -it nrit Iflflfi tliifi * K rx t n< nl 1 .i I , 1 J r\ <"-.-v t-« t* 

nrrncTTT u.i nu i ivirj 1 1 iui i 1 1 i\j rrTmr rorrr o I l'uji it 

nanoed over a maximum period »f throe yoaro, 
aed- the sal e smen ef- the wholooalor may collect 
payments from the retailor fe* the purchaso »f 
this oquipmont. Th e s e transactions shall include 
the following terms: a down payment ef at- least 
2© percent ef the total purchaso price, interest a* 
»et- less than the current primo Fate e» the date 
ef the contract e» the outstanding unpaid bal- 
anco at the outset ef each 44 months ef- the pe- 

i h_hj. i xt rrrr nil i~ si tuu i_^xtihoii lu to ttttttt? 1 1 iui t 

3Q days » arrears, if the above terms ate net 
met, the vrholooalor shall immediately repossess 
the equipment, a»4 the retailor shall surrender itr 
Whol e salers awi r e tail e rs Ghall retain copies ef 
these sales contracts fef inspection fef a p e riod 
ef thro e years. 

Statutory Authority G.S. 18B-207; I8B-III6. 

.0610 REFUSAL TO SELL; PRICING; 
SERVICING ACCOUNTS 

(a) Refusal to Sell to Retailer. A wholesaler 
of malt beverages or wine may refuse to sell al- 
coholic beverages to a retailer for legitimate 
business reasons so long as the decision not to 
sell is not related to the size of the account, the 



Statutory Authority G.S. 18B-207; I8B-1303(b). 

SECTION .0700 - ALCOHOLIC BEVERAGES: 

RETAILER/INDUSTRY MEMBER 

RELATIONSHIP: TRADE PRACTICES 

.0702 DEFINITIONS 

fa} £*e industry mombor, whothor lioonsod » 

1 \-\ i ..■ J^^Jii^ Q r" nnt (~\ f* « f c- fiHi<-rir ^Jtj-^^^f^^j- B *~" P I " T ' O Q 
Ttt^^j ^T^T^^^T ^^r ^^^^Ty ui 1 1 LP ^TT^T^^CT^ ^^^^^^^^^^^T^ ^nH^^^^'^rv 

ef affLliato shall oithor diroctly e* indirectly lend, 
give, furnish, &f offor te afiy r e tail pormittoo ef 
his omployoo, er te the ownor »f the premioos e» 
which the business ef the rotailer is conduct e d, 
He* shall such a pormittoo, omployoo, ef owner 
roquiro by agreement ef otherwise te aocopt from 
such a mombor any money, services, furniture, 
fixtures, signs, draught e quipment ef parts, 
glasses, napkins, trays, coasters, novelty it e ms, 
mirrors, supplies, ef other thing e£ value includ 
iftg aey free goods, morchandiso, morchundis e 
given free upon the basis ef a retailor's purchas e 
reaching a cortain quota, et a»y quantity dis- 
counts ef alcoholic beverage products, ef oth e r 
wise foil te carry eet m good faith the purpos e 
ef this Rule. 

fe) Definition ef Terms. Pef the purpos e ef 
this Rule, prohibited services include free instal 
lation, repair ef maint e nance ef oquipmont aed 

(r.i. > in ft n *' n *'"" *"* r Ml ]l,1,\,^«- l- i i-t-rA i-- n r nfhfir *■ i- 1 1 1 fnr 
nvu iii.i iULIUIIU 11 (J 1 UUIUUUI HI i,! r^ \J I 17 II IV 1 1 1 -TT *_II V. .' . 

"Thing ef value" includoo, promoting a particular 
retailor » advortisomonts; providing prizes at 
retailor conventions; advertising i» r e tail e r p e ri 
odicals; sponsoring parties fef retailors; guaran 
teoing loans ef r e tailors; oxtonding credit te 
retailors; failing te- roquiro a deposit equal te that- 
charged by a supplier e» k-egs aed roturnublo 
bottles: ef making discounts, rebates ef refunds 
conditioned eft their being applied by the r e tailer 
te pay eff a loan. 

For the purposes of this Section, the following 
definitions shall apply: 
(1) "Equipment" shall include draft beer boxes, 
wine dispensing machines, refrigeration de- 
vices, sinks, dishwashers, dispensing trucks, 
trailers, caddies, and any other item useful 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1695 



PROPOSED RULES 



or suitable for the preparation, serving, dis- 
pensing or cleaning of food or beverages or 
lood and beverage containers. 

(2) "Point-of-Sale advertising" shall mean ad- 
vertising material such as signs, posters, 
banners, and decorations that bears con- 
spicuous and substantial product advertising 
matter, that has no secondary value to the 
retailer, and that is designed and intended to 
be used inside a retailer's licensed premises 
where alcoholic beverage products are dis- 
played and sold. 

(3) "Promotion" shall include any advertising 
publicity or sponsorship activity in con- 
nection with any special event, function or 
holiday that is outside the scope of routine 
sales and marketing, and shall include 
fundraisers, concerts, sporting events, tes- 
tivals, celebrations, anniversaries, ceremo- 



nies. operations, observances, sweepstakes 
or contests. 

Statutory Authority G.S. ISB-207; 18B-1I16. 

.0704 REMOVAL OR DISTURBANCE OF 
OTHER BRANDS PROHIBITED 

No wholesaler shall remove from a retailer's 
premises any bottles, cartons or kegs bearing 
brand identification except brands that are dis- 
tributed by that wholesaler. No wholesaler shall 
remove, rearrange or otherwise disturb any malt 
beverages or wine displayed on a retail licensed 
premises by another wholesaler, except: te- Fe- 
tes* merchandis e te its properly assigned shelf 
space ' whc - n it- hr» boon inadvertently placed i» 
t&e wholesaler's assigned spac e . 

( 1 ) to return merchandise to its properly as- 
signed shelf space when it has been inad- 
vertently placed in the wholesaler's assigned 
space; or 

(2) to remove a competitor's product from a 
promotional display area that has been as- 
signed to the wholesaler, and the compet- 
itor's personnel are not available to move 
their own product from the area at the time 
the wholesaler's product is scheduled to go 
on promotion. 

Statutory Authority G.S. 18B-207; J SB- 1 116(b). 

.0707 INDUCEMENTS (TIED HOUSE) 

No industry member shall: 

( 1 ) acquire or hold any interest in any license 
or permit with respect to the premises of a 
retail permittee; 

(2) acquire any interest in real or personal 
property owned, occupied, or used by a re- 
tail permittee in the conduct of his business; 



(3) furnish, give, rent, lend, or sell to a retail 
permittee any equipment, fixtures, signs, 
supplies, money, services, or other things of 
value except as otherwise provided in these 
Rules; 

(4) pay or credit a retail permittee for any ad- 
vertising, display, or distribution service; 

(5) guarantee any loan or the repayment of 
any financial obligation of a retain retail 
permittee; 

(6) extend credit to a retail permittee, except 
as otherwise provided in these Rules: e* 

(7) require a retail permittee to take and dis- 
pose of a certain quota of any alcoholic 
beverages; 

(8) acquire any interest in a mortgage or deed 
of trust on the retailer's business or property; 

(9) pay for the display of advertising on any 
signs or scorecards manufactured by a third 
party for a retailer; 

(10) furnish free warehousing by delaying de- 
livery of alcoholic beverage product or by 
providing refrigerated vehicles for a retailer; 
or 

(11) purchase advertising on signs, scoreboards 
and programs at ballparks, racetracks, and 
coliseums from the retail concessionaire, 
unless the retailer is a city or county, and an 
exemption has been granted pursuant to 
G.S. 18B-1 116(b). 

Statutory Authority G.S. ISB-207; 1SB-1 116(a). 

.0708 COMMERCIAL BRIBERY 

(a) No industry member shall make secret gifts 
or payoffs to purchasing agents, clerks, 
bartenders, salesmen or other employees of retail 
permittees. 

(b) No industry member shall give any bonus, 
premium or compensation to any retailer or an 
officer, employee or agent of the retailer. Pro- 
hibited acts include: 

(1) monetary inducements ("push money") 
given to retailers or their employees; 

(2) total or partial payment of a retailer's em- 
ployee's salary; 

(3) sales promotion contests in which a 
retailer's employees are offered or 
awarded prizes, such as trips abroad, cash, 
or automobiles that are totally or partially 
financed by an industry member; 

(4) payments or gratuities to groups or asso- 
ciations of retailer's employees; &? 

(5) other gifts such as trips, appliances, or 
other items given to retail corporate offi- 
cers; or 

(6) participation in a retailer's sales or man- 
agement meetings, conventions or outings 



1696 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



by sponsoring or underwriting any events 
in connection with the meeting, conven- 
tion or outing, unless such participation 
is limited to the providing of a hospitality 
suite with light hors d'oeuvres and 



beverages, and the price paid for the suite 
is not greater than that paid by any other 
participant in the meeting, convention or 
outing. 

Statutory Authority G.S. JSB-207; ISB-1 116(a). 

.0709 CONSIGNMENT SALES: CONDITIONAL 
SALES: RETURN'S 

(a) Consignment Sales Prohibited. No industry 
member shall sell, offer for sale, or contract to 
sell to any retail permittee, nor shall any retail 
permittee purchase, offer to purchase, or contract 
to purchase from any industry member any al- 
coholic beverages on consignment or under con- 
ditional sale, or with the privilege of return, or 
on any basis other than a bona fide cash sale. 
For the purposes of this Rule, a consignment sale 
is any transaction in which title to the merchan- 
dise is not transferred at the time of shipment or 
delivery and which does not involve some form 
of full cash settlement. No industry member 
shall contract or agree with a retailer to retain ti- 
tle ef to alcoholic beverages until those products 
are sold. 

(b) Privilege of Return. No industry member 
and retailer shall enter into any agreement 
whereby the retailer has an expressed or implied 
right to return alcoholic beverages that he cannot 
sell. Any acceptance of returned merchandise 
will be considered a strong indication that the 
"privilege of return" existed at the time of sale, 
and a repeated practice of accepting returned 
merchandise from a retailer would establish an 
implied privilege of return, even though no 
formal agreement has been made. 

(e) Exception. 44»s Rule shaM net- apply te- 
transactions involving solely bona fitle return ef 
alcoholic boveragoo fof ordinary a«4 usual com 
mercial reasons arising after the alcoholic 
bovoragos hav e boon sold, such as mutilated la- 
bel* Bf containers, product deterioration, ©f a 
bona ftde discontinuance ef- retailer's business. 

(c) (4) Sales Conditioned on the Acquisition of 
Other Merchandise. No industry member shall 
make any agreement with any retailer to accept 
as an agreement incident to present or future 
sales other alcoholic beverages that the retailer 
wants to remove from his inventory. The ex- 
change of alcoholic beverages for equal quantities 
of the same type and brand in containers of an- 
other size and style is not considered an acquisi- 
tion of "other" alcoholic beverages and, 



therefore, is not prohibited where the return is 

otherwise permissible. 
(d) Exceptions. This Rule shall not apply to 

the following transactions: 

(1) returns of malt beverages or wine for or- 
dinary and usual commercial reasons aris- 
ing after the alcoholic beverages have been 
sold, such as mutilated or damaged labels 
or containers, error in delivery, product 
deterioration, or a bona tide discontin- 



uance of the retailer's business; 



(21 



exchanges of malt beverage products for 
equal quantities of the same brand, type, 
size and container style, so long as the 
manufacturer's code date on the products 
will expire within 14 calendar days of the 



01 



date of exchange, and the quantity ex- 
changed does not exceed 20 cases of each 
brand per 14 day period. For the pur- 
poses of this Rule, the term "exchange" 
means to replace product for product and 
does not authorize the wholesaler to ac- 
cept returned malt beverage products for 
cash or credit; 

returns of wine or malt beverage products 
from a seasonal retailer who is open only 
a portion of the year if the products are 
likely to spoil during the off-season. For 
purposes of this Rule, a "seasonal 
retailer" is defined as one that closes its 
business completely for a period of at least 
eight weeks during the summer or winter 
months. Returns from a seasonal retailer 
may be for cash or credit. 
Note: The return or exchange of wine 
products is governed by this Rule and the 
regulations under the Federal Alcohol 
Administration Act found in Title 27 of 

Regu- 



the 



United States Code of Federal 
CFR 



lations, Part 1 1 

through 1 1.46), and nothing 



127 



Sec. 
in 



11.1 
these 



Rules shall be construed to authorize the 
return or exchange of wine products if the 
transaction is prohibited by federal law. 

Authority G.S. 1SB-207; ISB-1 116; 27 C.F.R. 
11.1 through 27 C.F.R. 11.46. 

.0710 EXCEPTIONS: ACCEPTED TRADE 
PRACTICES 

fa) {» retail outlets where wholesalers have 
been assigned specific space, these whol e salers 
Fftay price &f reprice their stock a* designat e d by- 
the retailor ae4 rearrang e a«4 plac e th e ir brand 
e* brands i» their assigned shelf spac e se as te 
properly rotat e their stock a«4 keep their a*- 

TM "jj.1 iru 7<i 'life l.'Ict.u i hi iu rrerrrr i tti^ (j^*."vi.h ivm i uu 

thorizos a wholesaler te- rearrang e ef reset a 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1697 



PROPOSED RULES 



retailer's alcoholic beverage shelf space, display 
area, m department pursuant te tfeafc r e tailer's 
f4a» m*4 direction, bet- tba* wholesaler sbaH- Bet- 
move »f disturb brands &ebJ by other whole 
sul e rs, 

fb-f Coil Cleaning Service. A wholesaler ef 
wine ep malt hcverauoo e»y render eee. cleaning 
senices te a r e tailer w4» ba» draught equipment. 

Statutory Authority G.S. 18B-207; 18B-lll6(b). 

.07! I PROHIBITED TRADE PRACTICES 

(a) General. It shall be a violation of these 
Rules for any industry member, whether or not 
licensed in this state, or any officer, director^ em- 



ployee or affiliate, to either directly or mdirectly 
lend, give, turnish or offer to any retail permittee 
or his employee, or to the owner of the premises 
on which the business of a retailer is conducted, 
or for any retail pennittee. employee, or owner 
to demand, require or accept from any industry 
member, anv money, services, furniture, fixture, 
equipment, sign, glasses, barware, supplies or 
other thing of value, except as provided in these 
Rules. 

(b) Prohibited Senices. By way of illustration, 
but not limitation, the following services shall 
not be furnished, given, provided or made avail- 
able to a retail permittee by an industry member, 
even if the retailer is charged or billed for the 
senices for their market value: 



ill 



in st ailing. 



equipment. 
tures; 



repairing or maintaining 
outdoor signs or other fix- 



(2) promoting a retailer in advertising: 

(3) reconciling inventory for a retailer: 

(4) breaking down empty boxes, cases or 
cartons: 

(5) providing labor or employees to assist a 
retailer in the retailer's promotional 
events: 

(6) loaning or renting aerial displays or out- 
door inflatables to a retailer for use, 
whether on or off the retailer's licensed 
premises: 

(7) pricing or repricing a product without the 
retailer's consent: 

(S) warehousing, by: 

(A) making refrigerated vehicles available 
to the retailer: or 

(B) delaying deliven - from a manufacturer, 
importer, nonresident vendor or ware- 



C) 



house in order to enable the retailer to 
take advantage of promotional prices or 
lor anv other reason: 

providing shelving schematics that are 
customized for an individual retailer or 
group of retailers, whether based on total 



beer or wine sales records from one store 
or a group of stores, but an industn' 
member may use its own sales statistics 
and records to develop a suggested shelf 
plan for alcoholic beverage products; 

( 10) affixing special retailer stamps or stickers 
to beer or wine packaging, but a whole- 
saler may affix signs, stickers, stamps, or 
tags indicating the product's price to a 
container, shelf or display of its products: 

(11) entering delivery data on a retailer's in- 
store computer; 

( 12) providing data processing services; 

(13) sponsoring sports leagues that are also 
sponsored by a retailer, or that use the 
facilities of a retailer for sporting events; 

(14) guaranteeing the loan of a retailer; 

( 15) extending credit to a retailer; 

( 16) failing to require a deposit equal to that 
charged by the supplier on kegs and re- 
turnable bottles; or 

( 17) negotiating special prices for or financing 
of equipment. 

(c) Prohibited Things of Value. By way of ih 
lustration, but not limitation, the following 
t lungs of value shall not be furnished, .given- 
loaned, r ented or sold to a retail pennittee by anv 
industn' member: 

( 1) aerial displays or tethered inflatables; 

(2) parties given for retailers or groups of 
retailers' employees, unless othenvise al- 
lowed bv the rules of the Commission; 

(3) prizes at retailer conventions: 

(4) advertising in a retailer periodical or ad- 
vertising in a retailer publication designed 
for distribution to consumers; 

(5) outside signs; 

(6) cooperative advertising, including, but not 
limited to: 

( A ) providing or assisting retailer pro- 
motions, whether on or off the retailer's 
premises; 

(Bi participation with a retailer in the ad- 
vertising of alcoholic beverages, the retail- 
er's business or special events unless 
specifically approved bv the Commission 
in the case of fundraisers for non-profit 
charitable organizations: 



(C) undenvnting the cost of T-markers, 
scorecards or scoreboards bv the purchase 
ot advertising from a third party; or 

(D) customizing point-of-sale advertising 
materials, novelties, glassware, consumer 
specialties or product displays bv printing 
or having printed the retailer s name, slo- 
gan or logo on the item, unless othenvise 
specifically allowed in the rules of the 
Commission: 



1 698 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



(7) making discounts, rebates or refunds to a 
retailer on the condition that the retailer 
use the discount, rebate or refund to pay 
off a loan; 

(8) equipment, fixtures or furnishings; or 

(9) clothing, except as provided in Rule .0713 
of this Section. 

Statutory Authority G.S. 18B-207; 1SB-1116 (a) 

(3), (b). 

.0712 ACCEPTED TRADE PRACTICES; 
SERVICES 

The following service activities are specifically 
allowed in transactions between industry mem- 
bers and retailers: 

( 1) Shelving; Pricing. In retail outlets where 
wholesalers have been assigned specific 
space, these wholesalers may price or reprice 
their stock as designated by the retailer and 
rearrange and place their brand or brands in 
their assigned shelf space so as to properly 
rotate their stock and keep their assigned 
space clean and neat. This Rule authorizes 
a wholesaler to rearrange or reset a retailer's 
alcoholic beverage shelf space, display area, 
or department pursuant to that retailer's 
plan and direction, but that wholesaler shall 
not move or disturb brands sold by other 
wholesalers. 

(2) Coil Cleaning Service. A wholesaler of 
wine or malt beverages may render coil 
cleaning services to a retailer who has 
draught equipment. 

(3) Generalized Schematics; Restrictions. 
General alcoholic beverage product sche- 
matics and shelving diagrams may be uti- 
lized by an industry member for sales 
presentations so long as: 

(a) the diagram utilizes generally available 
national, state or regional market research 
or the industry member's own sales data; 

(b) the industry* member does not solicit or 
receive individual sales figures or data 
from an individual retailer or group of 
retailers; and 

(c) the schematic or diagram is not custom- 



ized for an individual retailer or group of 
retailers who are similarly situated. 
(4) Participation in Retailer Association Ac- 
tivities. An industry member any participate 
in retailer association activities by: 

(a) displaying product at association con- 
ventions or trade shows; 

(b) renting display or booth space so long as 
the rental fee is not excessive and is the 
same as the fee paid by all exhibitors: 



(c) providing hospitality events which are in- 
dependent from association sponsored ac- 
tivities; 

(d) purchasing tickets to functions and paying 
registration fees if such fees are not exces- 
sive and are the same as paid by all ex- 
hibitors; and 

(e) making payments for advertisements in 
programs or brochures at association 
shows within the dollar limits established 
by 27 C.F.R. 6.100 and the Bureau of 
Alcohol, Tobacco and Firearms. 

(5) Educational Seminars. An industry 
member may provide or sponsor seminars 
for retailers and their employees in the fol- 
lowing areas: 

(a) the proper use of equipment; 

(b) the proper storage, handling and service 
of alcoholic beverages; 

(c) safe driving programs; 

(d) recognizing underage and intoxicated cus- 
tomers; and 

(e) the history or aspects of a product's man- 
ufacturing process. 

Seminars may be conducted at the premises 
of either the retailer or industry member. 



Nothing in this Rule shall be construed to 

authorize an industry member to pay the 

retailer's expenses in attending the seminar. 

(6) fastings. Beer and wine tastings may be 



conducted in accordance with 4 NCAC 2S 
.0901 and .0902 of this Chapter. 

(7) L^abor for Displays. An industry member 
may provide personnel to construct a pro- 
motional product display on the premises 
of a retailer, and may move other products 
from the display area in accordance with 
Rule .0704 of this Section. 

(8) Installations. The following items may be 
installed by an industry member at no 
charge to a retailer: 

(a) point of sale advertising materials; and 

(b) tapping accessories; 

(9) Bar Spending. An industry member may 
visit the premises of an on-premise retail 
account for the purpose of promoting its 
brands so long as: 

(a) the visit is unannounced and not adver- 
tised; and 

(b) a patron who refuses the industry' mem- 
ber's offer to consume a product is offered 
a comparable beverage of his choice, ei- 
ther alcoholic or non-alcoholic. 

malt 



(10} 



Non-alcoholic Beverages. 



A 



beverage wholesaler who is also engaged in 
the business of selling non-alcoholic 
beverage products may engage in the ac- 
cepted trade practices of the soft drink and 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1699 



PROPOSED RULES 



snack food industries, so long as the sales 
and practices surrounding the non-alcoholic 



unlawful inducement to purchase malt 
beverages. 



items shall not be customized for a retailer 
with the retailer's name or logo; 
beverage merchandise are not used as an (6) product displays, to include wine racks, 

bins, barrels, casks and shelving from 
which beer or wine are displayed and sold, 
so long as: 

(A) each display bears conspicuous and 
substantial advertising matter; and 

(B) the dollar limitations per brand im- 
posed by 27 C.F.R. 6.83 are not exceeded; 

(7) point of sale advertising materials which 
have value only as advertising, so long as 



Note: Wine wholesalers selling non- 



alcoholic beverage merchandise are governed 
by the provisions of 27 C.F.R. 6.101. 

Authority G.S. 18B-203 (b); I8B-207; ISB-1116 
(b); 27 C.F.R. 6.100; 27 C.F.R. 6.101 (19S6). 

.0713 ACCEPTED TRADE PRACTICES; 
THINGS OF VALUE 

(a) Items That Must Be Sold. The following 
things of value shall not be given, loaned or 
rented bv any industry member to a retailer, but 
may be sold to the retailer at the price paid for 
the item bv the first industry member who ac- 
quires the item: 

( 1 ) novelties, such as coolers, umbrellas, ice 
chests, beach towels, towels, and sports 
equipment, so long as the novelty item 
has not been customized for a retailer with 
the retailer s name or logo; 
glassware and cups, so long as the items 
have not been customized for a retailer 
with the retailers name or logo; 

(3) carbon dioxide; 

(4) ice: and 

(5) beer tapping accessories, including stand- 
ards, faucets, rods, vents, taps, hoses, 
washers, couplings, gas gauges, vent 
tongues, shanks, and check valves. 



lii 



Charge. 

given, furnished, loaned, rented or sold by an in- 

dustrv member to a retailer: 



Items That May Be Provided at No 
The following things of value may be 



Lii 
121 

01 

lii 

151 



samples of product as provided in 27 
C.F.R. 6.91; 

recipes, booklets and brochures for 
cooking with wine or malt beverages, as 
described m 4 NCAC 2S .1014 of this 



Chapter; 



wine and beer lists, in accordance with 4 
NCAC 2S .1008(a)(3) of this Chapter; 

combination packaging, as provided in 
27 C.F.R. 6.93: 

consumer specialty items such as bottle 
or can openers, cork screws, ash trays, 
shopping bags, individual can coolers, 
hats, caps, visors, t-shirts (without collars 
or buttons), or key_ chains. Such items 
may be given to retailers for distribution 
to consumers, or may be provided bv in- 
dustry- member personnel at the retailer's 
place of business during unannounced and 
unadvertised visits. Consumer specialty 



18} 



the pieces have not been customized for 
any individual retailer; and 
retailer advertising specialty items as de- 
scribed in 4 NCAC 2S .1008(a)(4) of this 
Chapter, so long as the items have not 
been customized for an individual retailer, 



and so long as the dollar limitations 



per 



l£l 



brand, as provided in 27 C.F.R. 6.85, are 
not exceeded. 

Point-Of-Sale Advertising Materials. 



Notwithstanding having a secondary value, the 
following items are considered to be point-of-sale 
materials and need not be submitted by an in- 
dustry member for approval prior to use, so long 
as the items contain conspicuous and substantial 
advertising materials: 

( 1) clocks; 

(2) lamps; 

(3) lighted displass; 

(4) blackboards; 

(5) bulletin boards; 

(6) dart board backgrounds; 

(7) menu and price boards; 

(8) tap standards; 

(9) calendars; and 
( 10) mirrors. 

Authority G.S. 18B-207; 18B-1 116(b); 27 C.F.R. 
6.83; 27 C.F.R. 6.85; 27 C.F.R. 6.91; 27 C.F.R. 
6.93 (1986). 

.0714 TRANSACTIONS WITH GOVERNMENT 
AND SPECIAL ONE-TIME PERMITTEES 

(a) Permitted Activities. Notwithstanding the 
restrictions contained in Rule .071 1 ot tlus Sec- 
tion, the following activities bv industry members 
are specifically allowed, as described in this Rule. 
in transactions with cities, counties, the state, or 
in transactions with nonprofit or political organ- 
izations that have obtained a Special One-Tune 
permit under the provisions of G.S. 
1SB-I002(a)(2) or (5), or nonprofit organizations 
that do not hold an ABC permit: 

( 1 ) sponsorships of festivals, concerts, 



fundraisers or special events cosponsored 
by the local government, the state or 



1700 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



nonprofit or political organizations, in- 
cluding payments of advertising fees; 

(2) loaning or renting portable equipment to 
a local government, the state or a 
nonprofit or political organization so long 
as the equipment loaned or rented is for 
a single event of limited duration; 

(3) contracts to provide payment for perma- 
nent advertising on signs or scoreboards 
when the industry member has submitted 
a request for and received an exemption 
pursuant to G.S. 18B-1 116(b); 

(4) providing labor or employees to assist in 
the setting up or changing of draft beer 
kegs and equipment; 

(5) loaning or renting previously approved 
aerial displays or outdoor inflatables for 
the duration of a special event, unless the 
event is held on the premises of a retailer; 

(6) loaning or allowing the use of refrigerated 
vehicles, unless the event is held in con- 
junction with and on the premises of a 
co sponsoring retailer; 

(7) providing novelties, prizes or prize money 
to nonprofit organizations that have ob- 
tained a Special One- Time Permit; 

making cash contributions to nonprofit 
organizations; 

participation with a local government or 
the state in the advertising of events 
cosponsored by the local government or 
state; 

the 



[81 

(21 



accepting 



return of alcoholic 



beverages not sold, for cash or credit, after 
the event is over. 



(b) Sponsorship Advertising Agreements Re- 
stricted. No sponsorship agreement or advertis- 
ing contract between an industry member and a 
city, county, the state, or a Special One-Time 
permittee shall contain any agreement, either ex- 
press or implied, that the industry' member's 
products will be sold to the exclusion, in whole 
or in part, of other brands of alcoholic beverages 
offered by competitors. 

(c) Cosponsorship with Retail Permittee. In 
any promotion by an industry member with a 
local government, the state, or a nonprofit or- 
ganization in which there is cosponsorship by a 
retailer other than the local government or the 
state, the industry' member shall obtain prior 
written approval from the Commission as pro- 
vided in Rule .0717 of this Section. 

Statutory Authority G.S. I8B-207; 18B-1 116(b). 

.0715 TOURNAMENTS 

(a) General. Sponsorship by an industry' 
member of a regional, statewide or national 



sports tournament, when the tournament is held 
on the property or premises of a retail permittee, 
is permissible only if all of the following condi- 
tions are met: 

(1) The tournament is promoted or sanc- 
tioned by the official governing body of 
the sport, or is promoted and sponsored 
by a bona fide nonprofit organization for 
the purpose of raising funds for a civic, 
scientific, charitable or educational cause; 

(2) No brand identified outdoor signs, ban- 
ners, aerial displays or inflatables are dis- 
played on the exterior of the retailer's 
premises; 

(3) No money, novelty items or other pro- 
hibited services or things of value are 
given, rented or loaned by an industry 
member to the retailer; and 

(4) All sponsorship money or fees and other 
things of value from the industry member 
are given to the official governing body of 
the sport or the nonprofit organization. 

(b) Advertising. An industry member may 
advertise via mass media or pay for the advertis- 
ing of a tournament when the primary theme of 
the advertisement is the tournament and its 



pose. The naming of the retailer's premises as 
the location of a tournament shall not be con- 
strued to be cooperative advertising in violation 
of 4 NCAC 2S .1007 of this Chapter when the 
retailer's tradename is stated in substantially 
smaller typeface. 

(c) Sponsorship: Advertising Agreements Re- 
stricted. No industry member agreeing to spon- 
sor a tournament shall enter into any agreement 
or contract, either express or implied, that a 
retailer or special one-time permittee will sell that 
industry member's products to the exclusion, in 
whole or in part, of other brands of alcoholic 
beverages offered by competitors. 

(d) Joint Sponsorships. An industry member 
shall not agree to cosponsor any tournament 
with any retail permittee unless the proceeds 
from the tournament are paid to a nonprofit 
civic, scientific, charitable or educational organ- 
ization. 



(e) Prohibited Sponsorships. An industry 
member shall not sponsor or aid a retailer in the 
promotion of any tournament held primarily to 
benefit the retailer, its employees, members or 
guests. 

Statutory Authority G.S. 1SB-207; 18B-1 116(b). 

.0716 CONSUMER CONTESTS; 
SWEEPSTAKES 

(a) General. Consumer contests or 

sweepstakes may be offered by an industry 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1701 



PROPOSED RULES 



member so long as no purchase is required. 
Entry forms may be attached to or part of an al- 
coholic beverage label or package so long as al- 
ternative methods of entry are available to the 
consumer by means of a tear pad crt entry forms 
available at the point of purchase, 
(b) Pomt-of-Sale Permissible; Restriction on 
Retailer Involvement. An industry member may 
provide point-of-sale advertising materials pro- 
moting a sweepstakes or contest to a retailer. 
An industry- member shall not offer or promote 
any sweepstakes or contest in conjunction with 
any retailer as a cosponsor or as the provider of 
any prize. No prizes may be drawn or awarded 
on the premises of any retailer. 

Statutory Authority G.S. 18B-207; /SB- J 116(b). 

.0717 CONDITIONS WHEN COMMISSION 
APPROVAL REQLIRED FOR 
PROMOTIONS 

(a) Prior Approval Required; Exceptions. An 
industry member shall obtain written approval 
from the Commission prior to entering into any 
agreement to engage in activities as a sponsor for 
any promotion, as that term is defined in Rule 
.0702(4) of this Section, unless the activity in- 
volves the following: 

( 1) sponsorships of nonprofit organizations 
that are not special one-time permittees, 
and the sponsored activity is neither held 
on the premises of a retailer nor 
cosponsored by a retailer; 

(2) printing and distribution of items that are 
classified as point-of-sale advertising ma- 
terial, consumer specialty items, retailer 
specialty items or novelty items, so long 
as the items are displayed and distributed 
in compliance with these Rules: 

(3) promotions that occur on an annual or 
regular basis and that have received writ- 
ten approval by the Commission in pre- 
vious years, so long as the sponsorship 
activities engaged in by the industry 
member have not changed; and 

(4) sponsorships of individual amateur sports 
teams, when: 

(A) the services or things of value provided 
bv the industry member are given to ben- 
efit the individual team and its members: 



(B) the team is not comprised of retailers 
or employees of retailers; and 

(C) the team is not jointly sponsored by a 
retailer. 

(b) Procedures for Approval. Requests for 
approval of any promotional activity shall be 
made in writing bv the industry member, and 
shall provide the following information: 



(1) names of all industry members partic- 
ipating; 

(2) names of all retailers involved as either 
co sponsors or as the host location; 

(3) name of nonprofit organization being 
sponsored, if any; 

(4) whether the organization being sponsored 
will obtain a Special One- Time permit; 

(5) purpose of the promotion; 

(6) beneficiary of the promotion, and de- 
scription of what benefits will be derived 
by the beneficiary; 

(7) copies of broadcast and print advertise- 
ments; 

(8) samples of advertising pieces and costs of 
items; 

(9) outdoor advertising to be used and lo- 
cation; 



(10) date(s) of promotion; and 

(11) complete description of industry mem- 
ber's activities in relation to the pro- 
motion, including statement of monies, 



fees, and items to be given in exchange for 
sponsorship rights, and person to whom 
given, 
(c) Notification to Wholesaler. A manufac- 
turer, importer or nonresident vendor of beer or 
wine that receives approval for promotional ac- 
tivity under this Rule shall provide a copy of the 
Commission's approval to each of its wholesalers 
in this state if that wholesaler is or will be par- 



ticipating in the promotion in any manner, in- 
cluding the distribution of promotional materials. 

(d) Approvals Restricted to Industry Members. 
No approval for any promotional activity bv an 
industry member will be granted to a special 
one-time permittee, retailer, advertising agency, 
broadcast lt or publisher. 

(e) Approvals Granted Onlv Upon Written 
Request, lhe Commission will decline the ap- 
proval of any verbal requests or hypothetical fact 
presentations describing promotional activities 
requiring prior written approval under this Rule. 

(f) Tuning of Requests. Industry members are 
encouraged to submit promotions for approval 
at least two months in advance of the promotion 
to allow adequate review bv the Commission, 
and to allow for the mailing of written approvals 
to the industry member. 

(g) Promotion Agreements Restricted. Com- 
mission approval of a promotion under this Rule 
shall not be construed as approval for the indus- 
try member to enter into anv agreement, either 
express or implied, that it's products will be sold 
or distributed by a retailer or special one-time 
permittee to the exclusion, in whole or in part, 
of other brands of alcoholic beverages offered bv 
competitors. 



1702 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



Statutory 
1SB-1I16. 



Authority G.S. 18B-I05; 18B-207; 



SECTION .0900 - DISTILLERS: 
REPRESENTATIVES 



.0901 



DISTILLER REPRESENTATIVES: 
PROHIBITED ACTS 

(a) Representatives Prohibited from Entering 
Store. Distiller representatives shall not enter 
any ABC store except for the purpose of calling 
on the buyer if the buyer's office is maintained in 
the store or for the purpose of making a pur- 
chase. 

(b) Representatives Prohibited from Contact- 
ing Store Personnel. Distiller representatives 
shall not contact, either directly or indirectly, or 
call upon store personnel while store personnel 
are off duty for the purpose of promoting their 
merchandise. Store personnel shall share equally 
with the distiller representative responsibility of 
any infraction of this Rule. 

(c) Gifts Prohibited. Representatives shall not 
give liquor or anything of value to store person- 
nel at any time. Store personnel shall be equally 
as guilty as the representative if they accept gifts, 
either directly or indirectly, from any represen- 
tative. 

(d) Soliciting and Advertising Prohibited. Ex- 
cept for purchases made by state or local officials 
for supply of ABC stores, salesmen of spirituous 
liquors liquor shall not with regard to purchases 
of spirituous liquors liquor by any person: 

(1) solicit any order, agreement, or other 
commitment to purchase liquor, whether 
or not it is legally enforceable; or 

(2) advertise, promote or encourage purchases 
by any means or method or furnish any 
means by which spirituous liquors liquor 
may be obtained, except as provided in 4 
NCAC 2S .1011 of this Chapter. 

Exceptions may be made upon notification from 
the Commission to a distiller representative when 
there is expressed interest by a fraternal or civic 
group in the purchase of a ceramic or 
commemorative decanter. L'pon notice, distiller 
representatives may present pictorial art work or 
renderings in solicitation and a presentation to 
that group. 

(e) Relationship With Mixed Beverages 
Permittee. No employee or representative of any 
distiller, importer, rectifier or bottler may in any 
manner promote or solicit orders by a mixed 
beverages permittee or aid the permittee in plac- 
ing orders for any spirituous liquor or for any 
other alcoholic beverages. 



(f) Gifts and Inducements Prohibited. No 
employee or representative of any rectifier or in- 
dustry member may give or lend to any mixed 
beverage permittee, or his employee any gift, 
money, sendees, equipment, furniture, fixture or 
other thing of value. 

Statutory Authority G.S. 18B-207; I8B-1I16. 

TITLE 10 - DEPARTMENT OF HUMAN 
RESOURCES 



1\ otice is hereby given in accordance with G.S. 
150B-21.2 that the DHRj Division of Medical As- 
sistance intends to amend rule(s) cited as 10 
NCAC26B .0121. 

1 he proposed effective date of this action is June 
1, 1992. 

1 he public hearing will be conducted at 1:30 
p.m. on March 17, 1992 at the North Carolina 
Division of Medical Assistance, 1985 Umstead 
Drive, Room 201, Raleigh, N.C. 27603. 

IXeason for Proposed Action: Private Duty 
Nursing (PDN ) services are amended to include 
coverage criteria, service location, prohibition on 
service duplication and payment, and clarification 
on licensure and certification. 



Co 



omment Procedures: Written comments con- 
cerning this amendment must be submitted by 
March 17, 1992, to: Dhision of Medical Assist- 
ance, 1985 Umstead Drive, Raleigh, N.C. 27603, 
ATTN.: Bill Hottel, APA Coordinator. Oral 
comments may be presented at the hearing. In 
addition, a fiscal impact statement is available 
upon written request from the same address. 

CHAPTER 26 - MEDICAL ASSISTANCE 

SUBCHAPTER 26B - MEDICAL ASSISTANCE 
PROVIDED 

SECTION .0100 - GENERAL 

.0121 PRIVATE DUTY NURSING 

(a) Medically necessary private duty nursing 
(PDN) services are provided when they are pre- 
scribed by a physician and prior approved by the 
Division of Medical Assistance or its ag e nt. 
designee. 

(b) Private? duty nursing services ate covered 
eftly when provided » the client's »w» home. 
A patient must reside in a private residence to 
receive PDN services. Recipients who are in 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1703 



PROPOSED RULES 



domiciliary care facilities (such as rest homes, 
group homes, family care homes, and similar 
settings) and those who are in hospitals, nursing 
facilities, intermediate care facilities for the men- 



tally retarded, rehabilitation centers, and other 
institutional settings arc not eligible for this ser- 
vice. PDN services are not covered while an in- 
dividual is being observed or treated in a hospital 
emergency room or similar environment. 

(c) Private duty nursing services are approvabl e 
wh e n other Medicaid oorvicoo, such a& hom e 

Vi r\ - ■ 1 i li i- fin '■ (jfl B /-nnfii-il 'wl.n-iii-ij/ih [ jtt^^jcI tti/t ^^^^^^L^ 
1 IV Q I I I I rTTTTrTT^ CTTTTTTTTT (lTIV^JUUH. 1 T III \S\J I 1 1 1\J I IWVUJ 

e£ the client. considered medically necessary 
when the person must require substantial and 
complex continuous nursing care by a licensed 
nurse. Professional judgment and a thorough 
evaluation of the medical complexity and 
psychosocial needs of the p atient are involved in 
determining the need for PDN. The following 
situations represent the usual types of cases that 
may require PDN, though the list is not meant 
to be all inclusive: 

( 1) Patient requires prolonged intravenous 
nutrition or drug therapy with needs be- 
yond those covered by home infusion 
therapy sendees. 

(2) Patient is dependent on a ventilator for 
prolonged periods. 

(3) Patient is dependent on other device-based 
respiratory support, including 
tracheostomy care, suctioning, and oxy 



gen support. 
(d) Medicaid payments fof PDN are made only 
te- agencies which afe accredited i» the provision 
ȣ in home nursing eaie by the Joint Committee 
e« the Accreditation e4 Health Organisations 
(JCAIIO), the National League fef Nursing ef 
who afe state licens e d at*4 Medicare certitied a* 
a home health agency. This service is only 
approvable based on the need for PDN services 
in the patient's private residence. An individual 
with a medical condition that necessitates this 
service normally is unable to leave the home 
without being accompanied by a licensed nurse 
and leaving the home requires considerable and 
taxing effort. An individual may utilize the ap- 



pro 



ved hours of coverage outside of his residence 



during those hours when the individual's normal 
life activities take the patient out of the home. 
The need for nursing care to participate in activ- 
ities outside of the home is not a basis for au- 
thorizing PDN" services or expanding the hours 
needed for PDN services. 

(e) A person may not receive Personal Care 
Services. Skilled Nursing Visits, and Home 
Health Aide Services reimbursed by Medicaid 



during the same hours of the day as PDN ser- 
vices. 

(f) The patient's spouse, child, parent, 
grandparent, grandchild, or sibling, including 
corresponding step and in-law relationship may 
not be employed by the provider agency to pro- 
vide PDN services to the patient when reim- 
bursed by Medicaid. 

(g) Medicaid payments for PDN are made only 
to agencies enrolled with the Division of Medical 
Assistance as providers for the service. An 
agency must be one of the following to be en- 
rolled to provide this service: 

(1) A Medicare certified home health agency 
located within North Carolina. 



(21 

01 



A State licensed home health agency lo- 
cated within North Carolina. 
An agency with a North Carolina office 
that is accredited in the provision of in- 
home nursing care by either the Joint 
Commission on Accreditation of Health 
Care Organizations (JCAHO) or the Na- 
tional I .eague for Nursing (NLN). 



Authority G.S. 108A-25(b); 10SA-54; 42 C.F.R. 
440.80. 

TITLE 1 1 - DEPARTMENT OF 
INSURANCE 



anu oxv- a j 

1 V < 



otice is hereby given in accordance with G.S. 
150B-2I .2 that the N.C. Department of Insurance 
intends to amend rules cited as 11 NCAC 8 .0801 
- .0802, .0805, .08/5 and adopted rules cited as 
11 NCAC 8 .0819 - .0836. 

1 he proposed effective date of this action is Mav 
1, 1992. 

1 he public hearing will be conducted at 1:00 
p.m. on March 2, 1992 at the Code Officials 
Qualifications Board, 410 N. Boy Ian Avenue, 
Raleigh, N.C. 27611. 

JXeason for Proposed Action: To provide for 
rules for the conduct of hearings in accordance 
with G.S. 150B-38(h). 

K^-omment Procedures: Written comments may 
be sent to Grover Sawyer, c,o Qualifications 
Board, P.O. Box 26387.' Raleigh, N.C. 27611. 
Oral presentations may be made at the public 
hearing. Anyone having questions should call 
Grover Sawyer at (919) 733-3901 or Ellen 
Sprenkelat (9/9) 733-4529. 



1704 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



tLditor's Note: These Rules have been filed as 
temporary rules effective March 3, 1992 for a 
period of 169 days to expire on August 21, 1992. 

CHAPTER 8 - ENGINEERING AND BUILDING 
CODES 

SECTION .0800 - DISCIPLINARY ACTIONS: 
OTHER CONTESTED MATTERS 

.0801 DISCIPLINARY POWERS 

(a) As used in this Section "Board" means the 
North Carolina Code Officials Qualification 
Board; "official" means a qualified Code- 
enforcement official as defined in G.S. 
143-151.8(5); and "Code" means the North 
Carolina State Building Code. 

(b) Any person who believes that an official is 
or has been in violation of G.S. 143- 15 1.1 7(a) 
may file a complaint against that official. Copies 
of 44- NCAC g MM this Section and G.S. 
143-151.17 shall be mailed to any person re- 
questing complaint information from the Board. 

(c) The complaint must specifically refer to one 
or more of the grounds in G.S. 143-151. 17(a). 
The name of the official, if known, and the name 
of the local inspection department must be listed. 
If the official is unknown, the complaint must 
refer to "the inspector who performed the build- 
ing (or electrical, mechanical, ©f plumbing or fire 
prevention) inspection." 

(d) Supporting information must be included 
to justify the complaint. If the complaint in- 
volves violations of the Code that the official did 
not discover, a list of those violations must be 
submitted with the complaint. Such information 
may be provided by the complainant, an archi- 
tect, professional engineer, licensed contractor, 
certified inspector, or other person with know- 
ledge of the Code. Supporting information must 
refer to specific violations of the Code or of the 
General Statutes. 

(e) The complaint must be in writing, signed 
by the complainant, and dated. The complaint 
must include the complainant's mailing address 
and a daytime phone number at which the 
complainant may be reached. The street address 
of the structure must be included. There must 
be a notarized verification at the end of the 
complaint. 



Statutory Authority G.S. 
143-151'. 17; 150B-38(h). 



143-151.12(1); 



investigation of the charges. If the staff roporto 
determines that the charges appear to have no 
basis in fact, the Board ohall se notify the person 
filing the complaint, staff shall, in writing: 

(1) advise the complainant in writing that the 
charges appear to have no basis in fact; 

(2) state the reasons for its determination; 

(3) advise the complainant that the 
complainant is entitled to a hearing before a 
committee of Board members, to be ap- 
pointed by the chairman of the Board, to 
determine whether the finding of the staff is 



correct; and 



(£1' 



advise the complainant that the 



.0802 PRELIMINARY INVESTIGATION 

On receipt of a complaint conforming to 1 1 
NCAC 8 .0801, the Board's staff shall make an 



complainant must make a written request 
for the hearing and must state in the request 
the reasons why the complainant is of the 
opinion the staff's determination is incorrect. 
If the complainant makes a written request for a 
hearing in accordance with this Rule, the com- 
mittee shall fix a time and place for the hearing 
and notify the complainant. If the poroon filing 
the complaint thon roquooto a formal hoaring ef 
the charges, &f tf the staff reports or the com- 
mittee finds that the charges may have some basis 
in fact, the Board shall fix a time and place for a 
hearing and give notice to the partioo. 
complainant and to the official. 

Statutory Authority G.S. 143-151.12(1); 
143-151. 17(b); I50B-38(h). 

.0805 HEARING OFFICER 

In all contested case hearings before the Board, 
the Chairman of the Board shall serve as presid- 
ing officer. In the absence of the Chairman, the 
Vice- Chairman shall serve as presiding officer, or 
a presiding officer shall be elected by the Board. 

Statutory Authority G.S. 143-151.12(1); 
143-151.17; I50B -38(h). 

.0815 FINAL BOARD ORDER 

(a) If after the close of a contested case hearing 
the Board decides that an official's conduct does 
not justify the suspension or revocation of his 
certificate but that his conduct does fail to con- 
form to the standards of good code enforcement 
practice, the Board may issue a letter of 
reprimand or a letter of caution to the official in 
which the Board may summarize those deficien- 
cies and make appropriate recommendations. 

(b) If a final board order is to suspend, revoke, 
or refuse to issue a certificate, the order shall set 
forth the conditions, if any, that must be met in 
order to remove the suspension, to re-issue the 
certificate, or to issue the certificate. 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1705 



PROPOSED RULES 



Statutory Authority G.S. 143-151.12(1); 

143-151. 17(c); I50B-38(h). 

.0819 GENERAL 

Governed by the principles of fairness, uni- 
formity, and punctuality, the following general 
rules apply: 

( 1) The Rules of Civil Procedure as contained 
in G.S. 1A-1, the General Rules of Practice 
for the Superior and District Courts as au- 
thorized by G.S. 7 A- 34 and found in the 
Rules Volume of the North Carolina Gen- 
eral Statutes apply in contested cases before 
the Board unless another specific statute or 
rule of the Board provides otherwise. 

(2) The Board may supply, at the cost of re- 
production, forms for use in contested cases. 

(3) livery document filed with the hearing of- 
ficer or the Board shall be signed by the at- 
torney who prepared the document, if it was 
prepared by an attorney, and shall contain 
his name, address, telephone number, and 
North Carolina State Bar number. An ori- 
ginal and one copy of each document shall 
be tiled. 

(4) Hxcept as otherwise provided by statute, 
the rules contained in this Section govern 
the conduct of contested case hearings under 
G.S. 143-151.17. 



(5) The content and the manner of service of 
the notice of hearing shall be as specified in 
G.S. 150B-38(b) and (c). 

(6) Venue in a contested case shall be deter- 
mined in accordance with G.S. 150B-38(e). 

(7) I learings shall be conducted, as nearly as 
practical, in accordance with the practice in 
the Trial Division of the General Court of 
Justice. 

(8) Hx parte communications in a contested 
case are governed by G.S. 150B-40(d). 

(9) This Section and copies of aU matter 
adopted by reference herein are available 
from the Board at the cost established in V 
NCAC 1 .0103. 



(10) The rules of statutory construction con- 
tained in Chapter j_2 of the General Statutes 
apply in the construction of this Section. 

(1 1) Unless otherwise provided in the rules of 
the Board or in a specific statute, time com- 
putations in contested cases before the 
Board are governed by G.S. 1A-1, Rule 6^ 



Statutoty Authority G.S. 
143-151.17; 150B-38(h). 



143-151.12(1); 



the definitions in U NCAC 8 .0801(a), the fol- 
lowing definitions apply to this Section: 

(1) "File or filing" means to place the paper 
or item to be filed into the care and custody 
of the hearing officer, and acceptance thereof 
by him, except that the Board may permit 
the papers to be filed with the Board, in 
which event the Board shall note thereon the 
filing date. All documents filed with the 
hearing officer or the Board, except exhibits, 
shall be duplicate in letter size 8 Vi " by 1 1". 

(2) "Hearing officer" means the presiding offi- 
cer specified in 1 1 NCAC 8 .0805. 

(3) "Party" means the Board, the official, or 
an intervenor who qualifies under 1 1 NCAC 
8 .0831. "Party" does not include a 
complainant unless the complainant is ah 
lowed to intervene under 1 1 NCAC 8 .0831. 



(4) "Service or serve" means personal delivery 
or, unless otherwise provided by law or rule, 
delivery by first class United States Postal 
Service mail or a licensed overnight express 
mail service, postage prepaid and addressed 
to the person to be served at his or her last 
known address. A Certificate of Service by 
the person making the service shall be ap- 
pended to every document requiring service 
under these Rules. Service by mail or lh 
censed overnight express mail is complete 
upon placing the item to be served, enclosed 
in a wrapper addressed to the person to be 
served, in an official depository of the 
United State Postal Service upon deliver, 
postage prepaid and wrapped in a wrapper 
addressed to the person to be served, to an 
agent of the overnight express mail service. 



Statutory Authority G.S. 
143-151.17; 150B-38(h). 



143-151.12(1); 



.0820 DEFINITIONS 

1 hi 1 definitions contained m G.S. 150B-2 are 
incorporated herein by reference. In addition to 



.0821 ORDER FOR PREHEARING 
STATEMENTS 

The hearing officer may serve all parties with an 
order for prehearing statements together with, or 
after service of, the notice of hearing. Every 
party thus served shall, within 30 days after ser- 
vice, file the requested statements setting out the 
party's present position on the following: 

( 1) The nature of the proceeding and the issues 
to be resolved; 

(2) A brief statement of the facts and reasons 
supporting the party's position on each 
matter in dispute; 

(3) A list of proposed witnesses with a brief 
description of his or her proposed testimony; 

(4) A description of what discovery, if any, the 
party will seek to conduct prior to the con- 



1706 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



tested case hearing and an estimate of the 
time needed to complete discovery; 

(5) Venue considerations; 

(6) Estimation of length of the hearing; 

(7) The name, address, and telephone number 
of the party's attorney, if any; and 

(8) Other special matters. 



Statutory 
143-151.17; 



A uthority 
150B- 38(h). 



G.S. 143-151.12(1); 



.0822 DUTIES OF THE HEARING OFFICER 

In conjunction with the powers in this Section 
and in G.S. 143-151.17, the hearing officer shall 
perform the following duties, consistent with law: 

( 1) Hear and rule on motions; 

(2) Grant or deny continuances; 

(3) Issue orders regarding prehearing matters, 
including directing the appearance of the 
parties at a prehearing conference; 

(4) Examine witnesses when deemed to be 
necessary to make a complete record and to 
aid in the full development of material facts 
in the case; 

(5) Make preliminary, interlocutory, or other 
orders as deemed to be appropriate; 

(6) Recommended a summary disposition of 
the case or any part thereof when there is 
no genuine issue as to any material fact or 
recommend dismissal when the case or any 
part thereof has become moot or for other 
reasons; and 

(7) Apply sanctions in accordance with 1 1 
NCAC 8 .0829. 

Statutory Authority G.S. 143-151.12(1); 
143-151.17; 150B-38(h). 

.0823 CONSENT ORDER; SETTLEMENT; 
STIPULATION 

Informal disposition may be made of a con- 
tested case or an issue in a contested case by 
stipulation, agreement, or consent order at any 
time during the proceedings. Parties may enter 
into such agreements on their own or may ask for 
a settlement conference with the hearing officer 
to promote consensual disposition of the case. 



Statutory Authority G.S. 
143-151.17; 150B-3S(h). 



143-151.12(1); 



.0824 SETTLEMENT CONFERENCE 

(a) A settlement conference is for the primary 
purpose of assisting the parties in resolving dis- 
putes and for the secondary purpose of narrow- 
ing the issues and preparing for hearing. 

(b) Upon the request of any party, the hearing 
officer shall assign the case to another Board 



member for the purpose of conducting a settle- 
ment conference. Unless the parties and the 
other Board member agree, a unilateral request 
for a settlement conference does not constitute 
good cause for a continuance. The conference 
shall be conducted at a time and place agreeable 
to all parties and the hearing officer. It shall be 
conducted by telephone if any party would be 
required to travel more than 50 miles to attend, 
unless that party agrees to travel to the location 
set for the conference. If a telephone conference 
is scheduled, the parties must be available by 
telephone at the time of the conference. 

(c) All parties shall attend or be represented at 
a settlement conference. Parties or their repre- 
sentatives shall be prepared to participate in 
settlement discussions. 



(d) The parties shall discuss the possibility of 
settlement before a settlement conference if thev 



believe that a reasonable basis for settlement ex- 
ists. 

(e) At the settlement conference, the parties 
shall be prepared to provide information and to 
discuss all matters required in jj_ NCAC 8 .0821. 

(f) If following a settlement conference, a 
settlement has not been reached but the parties 
have reached an agreement on any facts or other 
issues, the Board member presiding over the 
settlement conference shall issue an order con- 
firming and approving, if necessary, those matters 
agreed upon. The order is binding on the hearing 
officer who is assigned to hear the case. 

Statutory Authority G.S. 143-151.12(1); 
143-151.17; 150B- 38(h). 

.0825 PREHEARING CONFERENCE 

(a) The purpose of the prehearing conference 
is to simplify the issues to be determined; to ob- 
tain stipulations m regard to foundations for tes- 
timony or exhibits; to obtain stipulations of 
agreement on nondisputed facts or the applica- 
tion of particular laws; to consider the proposed 
witnesses for each party; to identify and exchange 
documentary evidence intended to be introduced 
at the hearing; to determine deadlines for the 
completion of any discovery; to establish hearing 
dates and locations if not previously set; to con- 
sider such other matters that may be necessary 
or advisable; and, if possible, to reach a settle- 
ment without the necessity for further hearing. 
Any final settlement shall be set forth in a settle- 



ment agreement or consent order and made a 
part of the record. 

(b) Upon the request of anv party or upon the 
hearing officer's own motion, the hearing officer 
may hold a prehearing conference before a con- 
tested case hearing. The hearing officer may re- 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1707 



PROPOSED RULES 



quire the parties to file prehearing statements in 
accordance with II NCAC 8 .0821. A prehear- 
ing conference on the simplification of issues, 
amendments, stipulations, or other matters may 
be entered on the record or may be made the 
subject of an order bv the hearing officer. Venue 
tor purposes of a prehearing conference shall be 
determined in accordance with G.S. 150B-38(e). 



Statutory A uthority 
143-151.17; 150B- 38(h). 



G.S. 143-151.12(1); 



.0826 CONSOLIDATION OF CASES 

(a) The hearing officer may order a joint hear- 
ing of any matters at issue in contested cases in- 
volving common questions of law or fact or 
multiple proceedings involving the same or re- 
lated parties, or may order the cases consolidated 
or make other orders to reduce costs or delay in 
the proceedings. 

(b) A party requesting consolidation shall serve 
a petition for consolidation on all parties to the 
cases to be consolidated and shall file the original 
with the hearing officer, together with a certificate 
of service showing service on all parties as herein 
required. Any party objecting to the petition 
shall serve and file his objections within 10 days 
after service of the petition for consolidation. 

(c) Upon determining whether cases should be 
consolidated, the hearing officer shall serve a 
written order on all parties that contains a de- 
scription of the cases for consolidation and the 
reasons for the decision. 

(d) Nothing contained iri this Rule prohibits 
the parties from stipulating and agreeing to a 
consolidation, which shall be granted upon sub- 
mittal of a written stipulation, signed by every 
party, to the hearing officer. 

(e) Following receipt of a notice of or order for 
consolidation, any party may petition for 
severance bv serving it on all other parties and 
filing with the hearing officer at least seven days 
before the first scheduled hearing date. If the 
hearing officer finds that the consolidation will 
prejudice any party, he shall order the severance 
or other relief that will prevent the prejudice from 
occurring. 



Statutory Authority G.S. 
143-151.17; 150B-3S(h). 



143-151.12(1); 



.0827 DISCOVERY 

(a) Discovery methods are means designed to 
assist parties in preparing to meet their responsi- 
bilities and protect their rights during hearings 
without undulv delaying, burdening or compli- 
cating the hearings process and with due regard 
to the rights and responsibilities of other parties 



and persons affected. Accordingly, parties are 
obligated to exhaust all less formal opportunities 
to obtain discoverable material before utilizing 
this Rule. 

(b) Any means of discovery available pursuant 
to the North Carolina Rules of Civil Procedure, 
G.S. 1A-1, is allowed. If the party from whom 
discovery is sought objects to the discovery-, the 
party seeking the discovery may file a motion 
with the hearing officer to obtain an order com- 
pelling discovery. In the disposition of the mo- 
tion, the party seeking discovery shall have the 
burden of showing that the discovery is needed 
for the proper presentation of the party's case, is 
not for purposes of delay, and that the issues in 
controversy are significant enough to warrant the 
discovery. In ruling on a motion for discovery, 
the hearing officer shall recognize all privileges 
recognized at law. 

(c) When a party serves another party with a 
request for discovery, that request need not be 
filed with the hearing officer but shall be served 
upon all parties. 

(d) The parties shall immediately commence to 
exchange information voluntarily, to seek access 
as provided by law to public documents, and to 
exhaust other informal means of obtaining 
discoverable material. 



(e) All discover.' shall be completed no later 
than the first day of the hearing. The hearing 
officer may shorten or lengthen the period for 
discovery and adjust hearing, dates accordingly 
and, when necessary', allow discovery' during the 
pendency of the hearing. 

(J} No later than 15 days after receipt of a no- 
tice requesting disco very, the receiving party 
shall: 



01 



move for relief from the request; 
provide the requested information, mate- 
rial or access; or 

offer a schedule for reasonable compliance 
with the request, 
(g) Sanctions for failure of a party to comply 
with an order of the hearing officer made pursu- 
ant to this Rule shall be as provided for bv G.S. 
1A-1. Rule 37, to the extent that an hearing offi- 
cer may impose such sanctions, and 1 1 NCAC 8 
.0829. 



Statutory 
143-151.17, 



Authority G.S. 
150B-38(h). 



143-151.12(1); 



.0828 SLBPOENAS 

(a) Subpoenas for the attendance and testi- 
mony of witnesses or for the production of doc- 
uments, either at a hearing or for the purposes 
of discovery, shall be issued in accordance with 
G.S. 150B-39(o and G.S. 1A-1 Rule 45. 



1708 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



(b) A subpoena shall be served in the manner 
provided bv OS. 150B-39(c) and G.S. 1A-1, 
Rule 45. The cost of service, fees, and expenses 
of any witnesses subpoenaed shall be paid by the 
party at whose request the witness appears. A 
party seeking an order imposing sanctions for 
failure to comply with any subpoena issued un- 
der this Rule must prove proper service of the 
subpoena. 

(c) Objections to subpoenas shall be heard in 
accordance with G.S. 150B-39(c) and G.S. 1A-1, 
Rule 45. 

Statutory Authority G.S. 143-151.12(1); 

143-151.17; 150B- 38(h). 

.0829 SANCTIONS 

(a) If a party fails to appear at a hearing or fails 
to comply with an interlocutory order of the 
hearing officer, the hearing officer may. 

( 1) Find that the allegations of or the issues 
set out in the notice of hearing or other 
pleading may be taken as true or deemed 
to be proved without further evidence; 

(2) Dismiss or grant the motion or petition; 

(3) Suppress a claim or defense; or 

(4) Exclude evidence. 

(b) In the event that any party, attorney at law, 
or other representative of a party engages in be- 
havior that obstructs the orderly conduct of pro- 
ceedings or would constitute contempt if done in 
the General Court of Justice, the hearing officer 
may enter a show cause order returnable in Su- 
perior Court for contempt proceedings in ac- 
cordance with G.S. 15()13-40(c)(6). 

Statutory Authority G.S. 143-151.12(1); 
143-151.17; 150B- 38(h). 

.0830 MOTIONS 

(a) Any application to the hearing officer for 
an order shall be by_ motion, which shall be in 
writing unless made during a hearing, and must 
be filed and served upon all parties not less than 
10 days before the hearing, if any, is to be held 
either on the motion or the merits of the case. 
The nonmoying party has 10 days after the date of 
of service of the motion to hie a response, which 
must be in writing. Motions practice in con- 
tested cases before the Board is governed by Rule 



ment is directed by the hearing officer. When 
oral argument is directed by the hearing officer, 
a motion shall be considered submitted for dis- 
position at the close of the argument. A hearing 
on a motion will be directed by the hearing offi- 
cer only if it is determined that a hearing is nec- 
essary to the development of a full and complete 
record on which a proper decision can be made. 
All orders on such motions, other than those 
made during the course of a hearing, shall be in 
writing and shall be served upon all parties of 
record not less than five days before a hearing, if 
any, is held. 



Statutory 
143-151.17, 



Authority 
I50B-38(h). 



G.S. 143-151.12(1); 



.0831 INTERVENTION 

(a) Any person not named in the notice of 
hearing who desires to intervene in a contested 
case as a party shall file a timely motion to in- 
tervene and shall serve the motion upon all ex- 
isting parties. Timeliness will be determined bv 
the hearing officer in each case based on circum- 
stances at the time of filing. The motion shall 
show how the movant's rights, duties, or privi- 
leges may be determined or affected by the con- 
tested case; shall show how the movant may be 
directly affected by_ the outcome or show that the 
movant's participation is authorized by statute, 
rule, or court decision; shall set forth the grounds 
and purposes for which intervention is sought; 
and shall indicate movant's statutory right to iiv 
tervene if one exists. 



(b) Any party may object to the motion for 
intervention bv filing a written notice of ob- 
jections with the hearing officer within five days 
after service of the motion if there is sufficient 
time before the hearing. The notice of objection 
shall state the party's reasons for objection and 
shall be served upon all parties. If there is in- 
sufficient time before the hearing for a written 
objection, the objection may be made at the 
hearing. 

(c) When the hearing officer deems it to be 
necessary to develop a full record on the question 
of intervention, he may conduct a hearing on the 
motion to determine specific standards that will 
apply to each intervenor and to define the extent 
of allowed intervention. 

(d) The hearing officer shall allow intervention 
upon a proper showing under this Rule, unless 
he finds that the movant's interest is adequately 
represented bv one or more parties participating 
in the case or unless intervention is mandated by 
statute, rule, or court decision. An order allow- 

be de- ing intervention shall specify the extent of par- 



6 of the General Rules of Practice for the Supe- 
rior and District Court. 

(b) If any party desires a hearing on the mo- 
tion, he shall make a request for a hearing at the 
time of the filing of his motion or response. A 
response shall set forth the nonmoving party's 
objections. All motions in writing shall be de 
cided without oral argument unless an oral argu- ticipation permitted the intervenor and shall state 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1709 



PROPOSED RULES 



the hearing officer's reason. An intervenor may 
be allowed to: 

( 1 ) Hie a written brief without acquiring the 
status of a party; 

(2) Intervene as a party with all the rights of 
a party; or 

(3) Intervene as a party with all the rights of 
a party but limited to specific issues and 
to the means necessary to present and de- 
velop those issues. 

Statutory Authority G.S. 143-151.12(1); 
143-151.17; 150B-38(h). 

.0832 CONTINUANCES 

(a) A request for a continuance of a hearing 
shall be granted upon a showing of good cause. 
Unless tune does not permit, a request for a 
continuance of a hearing shall be made in writing 
to the hearing officer and shall be served upon 
all parties of record. In determining whether 
good cause exists, due regard shall be given to the 
ability of the party requesting a continuance to 
proceed effectively without a continuance. A 
request for a continuance filed within five days 
before a hearing shall be denied unless the reason 
for the request could not have been ascertained 
earlier. 

(b) "Good cause" includes death or incapaci- 
tating illness of a party, representative, or attor- 
ney of a party; a court order requiring a 
continuance; lack of proper notice of the hearing; 
a substitution of the representative or attorney 
of a party if the substitution is shown to be re- 
quired; a change in the parties or pleadings re- 
quiring postponement; and agreement for a 
continuance by all parties if either more time is 
clearly necessary to complete mandatory prepa- 
ration for the case, such as authorized discovery, 
and the parties and the hearing officer have 
agreed to a new hearing date or the parties have 
agreed to a settlement of the case that had been 
or is likely to be approved by the final decision 
maker. 

(c) "Good cause" does not include: intentional 
delay; unavailability of counsel or other repre- 
sentative because of engagement in another judi- 
cial or administrative proceeding unless all other 
members of the attorney's or representative's firm 
familiar with the case are similarly engaged, or if 
the notice of the other proceeding was received 
subsequent to the notice of the hearing for which 
the continuance is sought; unavailability of a 
witness if the witness' testimony can be taken bv 
deposition: or failure of the attorney or repre- 
sentative to properly utilize the statutory notice 
period to prepare for the hearing. 



(d) During a hearing, if it appears in the interest 
of justice that further testimony should be re- 
ceived and sufficient time does not remain to 
conclude the testimony, the hearing officer shall 
either order the additional testimony taken by 
deposition or continue the hearing to a future 
date for which oral notice on the record is suffi- 
cient. 

(e) A continuance shall not be granted if 
granting it would prevent the case from being 
concluded within any statutory or regulatory 
deadline. 



Statutory Authority G.S. 
143-151.17; 150B-38(h). 



.0833 



143-151.12(1); 



RIGHTS AND RESPONSIBILITIES OF 
PARTIES 

(a) A party has the right to present evidence, 
rebuttal testimony, and argument with respect to 
the issues of law and policy, and to cross- 
examine witnesses, including the author of a 
document prepared bv, on behalf of, or for use 
of the Board and offered in evidence. 

(b) A party shall have all evidence to be pre- 



sented, both oral and written, available on the 
date for hearing. Requests for subpoenas, depo- 
sitions, or continuances shall be made within a 
reasonable time after their needs become evident 
to the requesting party. In cases when the hear- 
ing time is expected to exceed one day, the parties 
shall be prepared to present their evidence at the 
date and time ordered by the hearing officer or 
agreed upon at a prehearing conference. 

(c) The hearing officer shall send copies of all 
orders or decisions to all parties simultaneously. 
Any party sending a letter, exhibit, brief, memo- 
randum, or other document to the hearing officer 
shall simultaneously send a copy to all other 
parties. 

(d) All parties have the continuing responsibil- 
ity to notify the hearing officer of their current 
address and telephone number. 

(e) A party need not be represented by an at- 
torney. If a party has notified other parties of 
that party's representation by an attorney, all 
communications shall be directed to that attor- 
ney. 

(f) With the approval of the hearing officer, any 
person may offer testimony or other evidence 
relevant to the case. Any nonparty offering tes- 
timony or other evidence may be questioned by 
parties to the case and by the hearing officer. 

(g) Before issuing a recommended decision, the 
hearing officer may order any party to submit 
proposed findings of fact and written arguments. 



1710 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



Statutory Authority G.S. 143-151.12(1); 
143-151.17; !50B-38(h). 

.0834 WITNESSES 

Any party may be a witness and may present 
witnesses on the party's behalf at the hearing. 
All oral tcstimom at the hearing shall be under 
oath or affirmation and shall be recorded. At the 
request of a party or upon the hearing officer's 
own motion, the hearing officer may exclude 
witnesses from the hearing room so that thev 
cannot hear the testimony of other witnesses. 



Statutory Authority G.S. 
143-151.17; 150B-38(h). 



143-151.12(1); 



(fj The hearing officer may take notice of 
judicially cognizable facts by entering a statement 
of the noticed fact and its source into the record. 
Upon a timely request, any party shall be given 
the opportunity to contest the facts so noticed 
through submission of evidence and argument. 

(g) A party may call an adverse party; or an 
officer, director, managing agent, or employee of 
the State or any local government, of a public or 
private corporation, or of a partnership or asso- 
ciation or body politic that is an adverse party; 
and may interrogate that party by leading 
questions and may contradict and impeach that 
party on material matters in all respects as if that 
party had been called bv the adverse party. The 
adverse party may be examined by that party's 
counsel upon the subject matter of that party's 
examination in chief under the rules applicable 
to direct examination, and may be cross- 
examined, contradicted, and impeached bv any 
other party adversely affected by the testimony. 



Statutory Authority G.S. 
143-151.17; !50B-38(h). 



143-151.12(1); 



.0835 EVIDENCE 

(a) The North Carolina Rules of Evidence as 
found in Chapter SC of the General Statutes 
govern in all contested case proceedings, except 
as provided otherwise in this Section and G.S. 
150B-41. 

(b) The hearing officer may admit all evidence 
that has probative value. Irrelevant, incompe- 
tent, immaterial, or unduly repetitious evidence 
shall be excluded. The hearing officer may, in 
his discretion, exclude any evidence if its 
probative value is substantially outweighed by 
the risk that its admission will require undue 
consumption of time or create substantial danger 
of undue prejudice or confusion. 

(c) Contemporaneous objections by a party or 
a party's attorney are not required in the course 
of a hearing to preserve the right to object to the 
consideration of evidence by the hearing officer 
in reaching a decision or by the court upon judi- 
cial review. 

(d) AH evidence to be considered in the case, 
including all records and documents or true and 
accurate photocopies thereof, shall be offered and 
made a part of the record in the case. Except as 
provided in Paragraph JjQ of this Rule, factual 
information or evidence that is not offered shall 
not be considered in the determination of the 
case. Documentary evidence incorporated by 
reference may be admitted only if the materials cellation shall be liable for any cancellation fees. 



.0836 OFFICIAL RECORD 

(a) The official record of a contested case is 
available for public inspection upon reasonable 
request. The hearing officer may, upon good 
cause shown and consistent with law, order part 
or all of an official record sealed. 

(b) The official record shall be prepared in ac- 
cordance with G.S. 150B-42. 

(c) Contested case hearings shall be recorded 
either by a recording system or a professional 
court reporter using stenomask or stenotvpe. 

(d) Transcript costs incurred bv the Board shall 
be apportioned equally among the party(ies) re- 
questing a transcript. 

(e) Any other costs incurred by the Board 
when using a professional court reporter shall be 
apportioned equally among the requesting 
partv(ies). 

(f) A 24-hour cancellation notice is required in 
all cases. The partv(ies) responsible for the can- 



so incorporated are available for examination by 
the parties. 

(e) Documentary evidence in the form of 
copies or excerpts may be received in the dis- 
cretion of the hearing officer or upon agreement 
of the parties. Copies of a document shall be 
received to the same extent as the original docu- 
ment unless a genuine question is raised about 
the accuracy or authenticity of the copy or, under 
the circumstances, it would be unfair to admit the 
copy instead of the original. 



(g) Transcripts of proceedings during which 
oral evidence is presented will be made only upon 
request of a party. Transcript costs shall include 
the cost of an original for the Board. An attor- 
ney requesting a transcript on behalf of a party 
is a guarantor of payment of the cost. Cost shall 
be determined under supervision of the hearing 
officer who, in cases deemed to be appropriate 
by him, may require an advance security deposit 
to cover the prospective cost. The security de- 
posit shall be applied to the actual cost and any 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1711 



PROPOSED RULES 



excess shall be returned to the party that sub- 
mitted if 

(h) Copies of tapes are available upon written 
request at a cost of five dollars ($5.00) per tape. 

(1) Copies of Board hearings tapes or Non- 
Board certified transcripts therefrom are not part 
of the official record. 

Note: Rule 5.3(B) of the Rules of Professional 
Conduct permits an attorney to advance or 
guarantee expenses of litigation provided the cli- 
ent remains ultimately liable for such expenses. 

Statutory Authority G.S. 143-151.12(1); 
143-151'. 17: 150B-38(h). 

TITLE 13 - DEPARTMENT OF LABOR 

lyotice is hereby given in accordance with G.S. 
150B-21.2 that the Department of Labor intends 
to adopt rule(s) cited as 13 NCAC 15 .0429 and 
amend rule(s) cited as 13 NCAC 15 .020/ - 
.0206, .0302 - .0303, .0402 - .0404, .0406, .0413 - 
.0414, .0420 and .0424. 

± he proposed effective date of this action is May 
1, 1992. 

1 he public hearing will be conducted at 2:00 
p.m. on March 2. 1992 at the Highway Building, 
Auditorium, 1st Floor, 1 S. Wilmington Street, 
Raleigh, NC. 

IXeason for Proposed Action: This action will 
incorporate the current national codes governing 
devices and equipment within the jurisdiction of 
the Elevator and Amusement Device Division as 
rules of the division and provides for the automatic 
adoption of subsequent editions and revisions. 
Other changes are made in rules dealing with ele- 
vators and amusement devices including the 
adoption of a new rule dealing with go karts. 

C_- omment Procedures: People wanting to pres- 
ent oral testimony at the hearing should provide a 
written summary of the proposed testimony to the 
department by February 26, 1992. Written com- 
ments will be accepted by the department until 
March 15, 1992. Direct all correspondence to 
Bobby Bryan, NC Department of Labor. 4 W. 
Edenton Street, Raleigh, NC 27601. 

CHAPTER 15 - ELEVATOR AND AMUSEMENT 
DEVICE DIVISION 

SECTION .0200 - CODES AND STANDARDS 

.0201 ELEVATOR SAFETY CODE 



(a) The design, construction, installation, al- 
teration, repair, replacement, inspection, mainte- 
nance and operation of all new installations of 
elevators, dumbwaiters, escalators, moving walks, 
inclined stairway chairlifts, and inclined and ver- 
tical wheelchair lifts shall conform to these Rules 
and the American National Standard Safety Code 
for Elevators and Escalators, A 17.1 1981 with- 
addenda A17.1a 1985, A17.1b 1985 aft4 
A17.1c 1986 A17. 1-1990 which is hereby adopted 
incorporated by reference subject to the modifi- 
cations provided in (b) of this Rule. This incor- 
poration includes subsequent amendments and 
editions of this Code. 

(b) The provisions of the American National 
Standard Safety Code for Elevators and 
Escalators, A 17.1 shall be subject to the follow- 
ing modifications: 



(1) 



Rule 100. lc(2) — Observation Elevators 
Not Fully Enclosed. Change the rule to 
read as follows: For observation elevators 
which are not fully enclosed, protection 
at landings shall be provided as follows: 

(A) An enclosure shall be provided which 
shall extend a minimum of ten feet above 
the floor. 

(B) The enclosure shall be constructed of 
unperforated material. 

(C) Enclosures shall be located in the gen- 
eral line of the hoistway. Horizontal 
clearance shall be the same as stated in 
Section 108. 

(3) Rulo 1 10.2a — *w Passenger Elevators 
a«4 Fr e ight Elevators Authorized te> 
Carry Passengers. 

(A} Delete from the title the words: "and 
freight elevators authorized t& carry pas- 
sengers." 

f*+ Delete items (4) aa4 (£» si the contents. 
(4f [2] Rule 1 1 1.10 - Access to Hoistways for 
Emergency Purposes. In the first sentence 
change the word "may" to "shall." 

(4) (3) Rule 204. 2d - Side Emergency Exits. 

Side emergency exits shall not be permit- 
ted in elevator cars. 

Rule 300.3d — T-ef> Gaf Clear anco. 
Chang e the R*le te fea4 as follows: T4*e 

t f-v -r-v i~- o r- .--1 ,-w. «-.-. .-i ,-.,-. ,-- L ^ 1 I JiA O Q t hi..' th'in tJj^A 

11.' L,' CTTT" rrWtTTmOT [ 1 1 1 U ™ W rT^^T IVJJ 1 1 IU.1 1 ETTB 

SHfft »f the following twe items: 
fA4 the t&p eaf runby; 
fB^ the largest ef the following: 

(i) Two feet f6+© mm) above the eaf 
crosshead where a orosshoad is pfe- 
vidod; 

iii i I n n .-* ^-io^ f Y\ -i 1 1 tji^e^ t^A I , i. . - t h *"i n 1 '.,'. i \ 

I III TTT 1 l\J CTXLFV UI 1UIT 11 Id \J U\J 1L JJ 111U.11 rTTTT 

feet clearanc e (444 mm) abov e the eaf 
crossh e ad when the eaf has reached its 
maximum upward movement. 



& 



1712 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



(c) The rules of this Chapter shall control when 
any conflict between these rules and the ANSI 
Code exists. 

(d) Copies of the American National Standard 
Safety Code for Elevators and Escalators are 
available for public inspection in the office of the 
division, and may be obtained from the Ameri- 
can Society of Mechanical Engineers, United 
Engineering Center, 345 East 47th Street, New 
York, New York 10017. The cost is sovonty five 
dollars ($75.00) ninety six dollars ($96.00) per 
copy, fof non AS ME memb e rs as4 sixty dollars 
($60.00) fef momboro. 

Statutory Authority G.S. 95-110.5. 

.0202 EXISTING INSTALLATIONS, 

ALTERATIONS AND EXCEPTIONS 

(a) Existing Installations. Existing installations 
of elevators, escalators, dumbwaiters, and mov- 
ing walks shall be maintained under the depart- 
mental standards (if any) in effect at the time of 
their installation. Existing installations shall also 
meet the following standards whether or not 
there were departmental standards in effect at the 
time of their installation: 

(1) Electrically-powered elevator driving ma- 
chines shall be equipped with a friction 
brake applied by a spring or springs or by 
gravity and released electrically. 

(2) The car of every elevator suspended by 
wire ropes shall be provided with one or 
more safety devices. The safeties shall be 
attached to the car frame and one safety 
shall be located within or below the low- 
est members of the car frame (safety 
plant). All safeties shall be designed and 
installed in accordance with Section 205 
of the Elevator Safety Code, unless other- 
wise approved by the director. 

(3) Operating devices for electrically-powered 
or electrically-controlled elevators shall be 
of the enclosed electric type. Rope or rod 
operating devices activated directly by 
hand, or rope operating devices activated 
by wheels, levers or cranks shall not be 
used. 

(4) Elevator hoistways shall be enclosed 
throughout their height and all hoistway 
landing openings shall be protected with 
doors or gates. Hoistway enclosures shall 
be constructed to have a fire resistive rat- 
ing of not less than one hour. 

(5) Hoistway enclosure doors or gates shall 
be equipped with electric interlocks. 

(6) Each elevator car shall be permanently 
enclosed on all sides and the top, except 
the sides for entrance and exit. Car side 



enclosures shall be of such strength and 
so designed and installed that when sub- 
jected to a pressure of 75 pounds applied 
horizontally at any point on the walls of 
the enclosure, the deflection will not ex- 
ceed one inch. 

(7) Car top enclosures shall be so designed 
and installed as to be capable of sustaining 
a load of not less than 1 00 pounds at any 
one point. 

(8) An emergency exit with a cover shall be 
provided in the top of all elevator cars. 
The exit opening shall have an area of not 
less than 400 square inches and shall not 
measure less than 16 inches on any side. 
The exit shall be so located as to provide 
a clear unobstructed passage through it. 
The exit cover shall open outward and be 
hinged or otherwise attached to the car 
top and arranged to be opened from the 
top of the car only. 

(9) A door or gate shall be provided at each 
entrance to the car. 

(10) Doors shall be of the horizontally or 
vertically sliding type. Gates shall be of 
the vertically sliding or horizontally sliding 
collapsible type located not more than 
1-3/4 inches from the car sill. Gates shall 
extend from a point not less than one inch 
above the car floor to not less than six feet 
above the car floor. 

(11) Vertically sliding gates when in the fully 
opened position shall provide an entrance 
of not less than six feet in height. Such 
gates shall be provided with pull straps to 
facilitate closing of the gate. 

(12) Each car door shall be equipped with a 
car door or gate electric contact so located 
as to be inaccessible from inside the car 
door and shall stop the car when the gate 
is opened a maximum of two inches. 

The completion of any of the items in Subpara- 
graphs (1) through (12) of Paragraph (a) of this 
Rule that increases the gross load of the elevator 
shall not reduce the safety factor of the driving 
machine below that required by rule 208.3 of 
A17.1, the American National Standard Safety 
Code for Elevators and Escalators. 



(b) Exceptions. Existing elevators in ware- 
houses of not more than two floors that are not 
accessible to the general public are exempt from 
Subdivisions Subparagraphs (4) through (12) of 
Paragraph (a) of this Rule providing that all of 
the following conditions are met: 

(1) The warehouse shall be used solely for the 
purpose of storing materials and products. 

(2) Hoistways shall be provided with ade- 
quate guards as approved by the director. 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1713 



PROPOSED RULES 



(3) All capabilities of operating the elevator 
from the car or platform shall be removed. 

(4) Riders shall not be permitted to ride the 
car or platform. 

(5) A sign stating "Absolutely No Riders 
Permitted" in letters no less than one inch 
high on a contrasting background shall be 
posted at each entrance to the elevator. 

(c) If an existing installation meets the re- 
quirements of Paragraph (a) of this Rule, it shall 
be issued a regular certificate of operation pursu- 
ant to Rule .0306 of this Chapter. If an existing 
installation is maintained under the departmental 
standards (if any) in effect at the time of its in- 
stallation and is not exposing the public to an 
unsafe condition likely to result in serious per- 
sonal injury or property damage, but does not 
meet the twelve standards specifically set out in 
Paragraph (a) of this Rule, it shall be issued a 
certificate of operation containing the following 
statement: 

"Warning: This elevator has been 
inspected and found to be in a 
reasonably safe condition; how- 
ever, it is not equipped with some 
of the safety features now required 
by the Department of Labor." 
If the existing installation is not in compliance 
with the requirements of Paragraph (a) of this 
Rule by January 1, 1991, the following sign in 
letters no less than one inch high on a contrasting 
background shall be posted within and at each 
entrance to the elevator: 

"Riders prohibited — only a trained oper- 
ator may ride this elevator." 

(d) Units of existing installations which are 
out-of-service and not continuously maintained 
for a period exceeding one year shall be properly 
landed by complying with the following: 

(1) Land both car and counterweight (if any) 
at the bottom of the hoistway. Elevators 
of the roped type shall have their hoist 
ropes disconnected at both ends. 

(2) All electric power shall be removed by 
disconnecting and removing the power 
feeders. 

(3) All hoistway entrances shall be perma- 
nently secured to prevent accidental or 
inadvertent entry into the hoistway. 

.Any elevator, dumbwaiter, escalator or moving 
walk that has been properly landed or otherwise 
removed from service for a period exceeding one 
year shall comply with the requirements of the 
elevator safety code in effect at the time they are 
returned to service. 

(el Existing installations of elevators, 

escalators, dumbwaiters or moving walks altered 
in accordance with Part XII of ANSI ASME 



A 17. 1-1990 after May L 1992, shall conform to 
the American National Standard Safety Code for 
Existing Elevators and Escalators, ANSLASME 
A17.3-1990 which is hereby incorporated by ref- 
erence. This incorporation includes subsequent 
amendments and editions of this Code. Copies 
of the Amencan National Standard Safety Code 
for Existing Elevators and Escalators may be 
obtained from the American Society of Mechan- 
ical Engineers, United Engineering Center, 345 
East 47th Street, New York, New York 10017. 



The cost is forty- seven dollars ($47.00) per copy. 
Statutory Authority G.S. 95-110.5. 

.0203 SAFETY STANDARD FOR MANLIFTS 

(a) The design, construction, installation, al- 
teration, repair, replacement, inspection, mainte- 
nance and operation of all manlifts shall conform 
to these Rules and the American National 
Standard Safety Standard for Manlifts, 
A90.1 1976 A90. 1-1985 which is hereby adopted 
incorporated by reference. This incorporation 
includes subsequent amendments and editions of 
this Code. 

(b) The rules of this Chapter shall control 
when any conflict between these rules and the 
ANSI Code exists. 

(c) Copies of the American National Standard 
Safety Standard for Manlifts are available for in- 
spection at the offices of the division and may 
be obtained from the American Society of Me- 
chanical Engineers, United Engineering Center, 
345 East 47th Street, New York, New York 
10017 at a cost of a* dollars (S6.00) thirty dollars 
($30.00) per copy, fef non members as4 few 
dollars a»4 eighty cents ($1.80) fof members. 

Statutory Authority G.S. 95-1 10.5. 

.0204 PERSONNEL HOISTS CODE 

(a) The design, construction, installation, al- 
teration, repair, replacement, inspection and op- 
eration of all personnel hoists shall conform to 
these Rules and the .American National Standard 
Safety Requirements for Personnel Hoists, 
A 10.4- 1981 which is hereby adopted incorpo- 
rated by reference. This incorporation includes 
subsequent amendments and editions of this 
Code. 

(b) The rules of this Chapter shall control 
when any conflict between these rules and the 
ANSI Code exists. 

(c) Copies of the American National Standard 
Safety Requirements for Personnel Hoists are 
available for inspection at the offices of the divi- 
sion and may be obtained from the American 
National Standard Institute, Inc., 1430 



ru 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



Broadway, New York, New York 10018 at a cost 
of te» dollars ($10.00) eighteen dollars ($18.00) 
per copy. 

Statutory Authority G.S. 95-110.5. 

.0205 TRAMWAY REQUIREMENTS 

The construction, operation and maintenance 
of passenger tramways shall conform to the 
American National Standards Safety Require- 
ments for Aerial Passenger Tramways, 
B77.1-1982 as supplemented by B77.1a-1986 
which is hereby adoptod incorporated by refer- 
ence. Copies of the requirements are available 
for inspection at the office of the division and 
may be obtained from the American National 
Standards Institute, Inc., 1430 Broadway, New 
York, New York 1 00 1 8 at a price of tw e lve del- 
las ($12.00) thirty five dollars ($35.00) per copy. 
This incorporation includes subsequent amend- 
ments and editions of this Code. 

Statutory Authority G.S. 95-120. 

.0206 NATIONAL ELECTRICAL CODE 

(a) All devices and equipment subject to this 
Chapter shall be designed, constructed, installed, 
maintained and operated in accordance with 
these Rules and the requirements of the 1987 
1990 edition of the National Electrical Code, 
NFPA 70 1987 70-1990 which is hereby adoptod 
incorporated by reference. This incorporation 
includes subsequent amendments and editions of 
this Code. 

(b) The rules of this Chapter shall control 
when any conflict between these rules and the 
National Electrical Code exists. 

(c) Copies of the National Electrical Code are 
available for inspection in the offices of the divi- 
sion and may be obtained from the State Board 
of Examiners of Electrical Contractors, 1200 
Front Street, Suite 105, P. O. Box 18727, 
Raleigh, NC 27619 at a cost of fourteen dollars 
($14.00) per copy at the office or fifteen dollars 
($1 5.00) per copy if mailed. 



Statutory Authority G.S. 
95-120. 



95-110.5; 95-111.4; 



SECTION .0300 - ELEVATORS AND RELATED 
EQUIPMENT 

.0302 RESPONSIBILITY 

Responsibility for the installation, alteration, 
operation, maintenance, and reporting of acci- 
dents for elevators, dumbwaiters, escalators, 
moving walks, personnel hoists, and special 
equipment shall be as follows: 



(1) The equipment manufacturer shall be re- 
sponsible for designing and manufacturing 
equipment in compliance with the applica- 
ble code. 

(2) The person or firm installing or altering el- 
evators, dumbwaiters, escalators, moving 
walks, personnel hoists, and special equip- 
ment shall be responsible for obtaining all 
permits and approvals. He shall be respon- 
sible for the safe operation of equipment 
during the installation until a certificate of 
operation has been issued and for conduct- 
ing all tests required by these rules. 

(3) The owner, his duly appointed agent, or the 
lessee shall be responsible for the safe oper- 
ation and proper maintenance of elevators, 
dumbwaiters, escalators, moving walks, per- 
sonnel hoists, and special equipment after 
the installation has been approved and a 
certificate has been issued. He shall be re- 
sponsible for conducting all periodic or 
maintenance tests required by these rules. 

(4) The owner shall also be responsible for 
having elevators in closed buildings in- 
spected by North Carolina Department of 
Labor inspectors. The owner or agent shall 
contact the Elevator and Amusement Device 
Division to arrange a convenient time for 
inspection. Elevators not inspected shall be 
considered as being removed from service. 

Statutory Authority G.S. 95-110.5. 

.0303 CONSTRUCTION PERMITS 

(a) Before erecting or constructing a new ele- 
vator, dumbwaiter, workman's hoist, escalator, 
moving walk, stairway inclined lift, or vertical 
wheelchair lift, or before moving such an appa- 
ratus from one location to another, or before 
making alterations to existing equipment, the 
owner or his authorized agent shall obtain a per- 
mit from the director. The owner or his author- 
ized agent shall submit an application for a 
permit accompanied by duplicate plans and 
drawings showing the proposed construction, 
type of equipment and mode of operation. The 
application to install which consists of the ori- 
ginal and three copies shall include the following 
information: 

(1) name and address of architect, owner, and 
installer; 

(2) type and design of equipment; 

(3) pertinent information as to the location 
of the equipment and such specifications 
as required by the Elevator Safety Code. 

(4) a permit from the local building inspector 
that- the plannod stairway inclin e d bft ef 
vertical wheelchair bit ¥4h h«4- hind e r 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1715 



PROPOSED RULES 



egress e* in gross from the building f»- 
quirod by the North Carolina Building 
Code. U a» local building inspector k 
availabl e , the permit must be obtain od 

If/it-n tl-i.i , . « i urn <-t.t»~«T-ijt i 1 | i i.i/\n ^t T *h^ ^l^K 
TTTTTTT tTT^ CI 1 JilO^^TTTTTz Ul VI 9I0S C^ lin^ I 'til HI 

Carolina Di'partmL ' nt »f Insuranc e . 

(b) Upon finding that the application is in 
compliance with the regulations of this Chapter, 
the director will issue a permit, subject to final 
field inspection. 

(c) The permit shall be posted in a conspicuous 
place on the job site prior to the start of any 
work to be done. 

(d) Upon receiving information indicating vio- 
lation of this Rule, the director may cause the 
stoppage of all work on that job until a hearing, 
pursuant to the provisions of the Administrative 
Procedure Act, N.C. General Statutes, Chapter 
150B Article 3 can be held to determine the rea- 
son for the violation. 

(e) The operation or use of any new, altered, 
or relocated equipment subject to the Elevator 
Safety Code other than by the installer acting 
under the authority of a construction permit is 
prohibited until such equipment has passed tests 
and inspections as required by Rule .0305 of this 
Section and a certificate to this effect has been 
issued in accordance with Rule .0306 of this 
Section. 

Statutory Authority G.S. 95-110.5. 

SECTION .0400 - AMUSEMENT DEVICES 

.0402 RESPONSIBILITY FOR COMPLIANCE 

(a) Every owner or operator of an amusement 
device shall comply with or affect compliance 
with all provisions of the rules of this Section, 
and every employer and employee shall comply 
with all provisions which concern or affect his 
conduct. 

(b) Designers and manufacturers of amusement 
devices shall follow the procedures of the Stand- 
ard Practice for The Design Manufacture of 

Amusement Rides and Devices ASTM F 1159 Statutory Authority G.S. 95-1 1 1.4. 
in the manufacture of all ndes. An engineering 
analysis of each ride or device shall be submitted 



(1) devices having suspended passenger seats 
or spaces, 

(2) devices normally operated at speeds or 
with movements creating severe 
centrifugal forces, 

(3) devices so elevated that structural failure 
is likely to cause passengers to be injured 
by falling, or 

(4) devices on which the director has ordered 
such a test upon finding it necessary to 
assure safety. 

(b) Evidence of Test. Unless a load test is 
made in the presence of a representative of the 
director, the director may accept a certified copy 
of such test made by a person qualified to per- 
form such tests, showing whether the device 
withstood the test without failures in any mate- 
rial respect and setting forth such other relevant 
information as the director may require. Until 
such a statement is so filed it shall be presumed 
that the device has not withstood the test as re- 
quired. 

(c) Nature of Test. Each passenger seat or 
space shall be weighted with at least 440 170 
pounds dead weight, except that in a device in- 
tended only for small children each seat or space 
shall be weighted with at least ?§ 90 pounds as 
recommended by ASTM F 1 159. While so 
loaded the device shall be so operated at maxi- 
mum normal speed as to test the full operation 
or all control devices, speed limiting devices, 
brakes and other equipment provided for safety. 

(d) Effect of Test. If the device fails to with- 
stand a load test it shall be deemed unsafe and 
shall not be used until and unless it has 
withstood a subsequent load test without failure 
in any material respect. If the device has 
withstood a load test without failure in any ma- 
terial respect it shall be required to be so tested 
again only if rebuilt or modified or if there are 
reasonable grounds to believe that a further test 
is necessary to assure safety and the director or- 
ders such test to be made. 



to the North Carolina Department of Labor, El- 
evator and .Amusement Device Division, before 
it is operated in North Carolina. 

Statutory Authority G.S. 95-1 1 1.4. 

.0403 LOAD TESTS 

(a) Test Required. Load tests will not be re- 
quired on a regular basis. The director may, 
however, at his discretion require a load test to 
be made on devices of the following types: 



.0404 LOCATION NOTICES 

No amusement device shall be used at any time 
or location unless prior notice has been given to 
the director pursuant to G.S. 95-111.8. Notice 
shall include: 

(1) the name and permanent address of the 
operator, 

(2) the name and identification number of ev- 
ery amusement device, a«4 

(3) the intended date(s) and location(s) of use, 
and 

(4) the date the inspection is requested. 



1716 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



Statutory Authority G.S. 95-111.4; 95-111.8. 

.0406 UNSAFE DEVICES 

If the inspector finds that the amusement device 
presents an imminent danger, he may attach to 
such device a notice warning all persons against 
the use thereof. Such notice shall not be re- 
moved until the device is made safe, and then 
only by a representative of the director. In the 
meantime, the device shall not be used and shall 
be dismantled and removed from the grounds. 

Statutory Authority G.S. 95-111.4; 95-111.6; 
95-111.9. 

.0413 WIND AND STORM HAZARDS 

The manufacturer or designer of amusement 
rides or devices shall post on the ride, in a 
prominent place, the maximum design wind 
speed for safe operation of the ride. An 
amusement device which is exposed to wind or 
storms shall not be operated under dangerous 
weather conditions except to release or discharge 
occupants. 

Statutory Authority G.S. 95-111.4. 

.0414 LIGHTING 

(a) Amusement devices, access thereto and exits 
therefrom, shall, while in operation or occupied, 
be provided with illumination by natural or arti- 
ficial means sufficient to guard against personal 
injuries under these circumstances. 

(b) Lighting fixtures shall have their lamps 
guarded to protect against accidental contact and 
to reduce possible injury' from glass if the lamps 
break. Fluorescent lamps installed on or over 
moving parts of a ride shall be covered with 
plastic sleeves. 

Statutory Authority G.S. 95-111.4. 

.0420 PUBLIC PROTECTION 

An amusement device shall not be used or op- 
erated while any person is so located as to be 
endangered by it. Areas in which persons may 
be so endangered shall be fenced, barricaded, or 
otherwise guarded against public intrusion. 
Fences, when used to comply with this Rule, 
shall be at least 42 inches high and shall have es- 
sentially vertical mullions located to reject a ball 
six inches in diameter. 

Statutory Authority G.S. 95-111.4. 

.0424 ELECTRICAL SAFETY REQUIREMENTS 



(a) General Requirements. All electrical wir- 
ing, equipment and apparatus used for 
amusement devices or for lighting shall comply 
with the National Electrical Code, NFPA 70 and 
shall be properly and legally installed, operated 
and maintained. 

(1) Branch Circuits. The circuit for each ride 
shall be protected by fuses or a circuit 
breaker at the junction box or at the gen- 
erator. 

(2) Disconnecting Means. Each ride shall be 
provided with a main line disconnect 
switch or breaker. The disconnect switch 
or breaker shall be located at the ride. 
Each branch circuit on a ride shall be fur- 
ther provided with a disconnecting means. 

(3) Conductors. Conductors supplying cur- 
rent to rides shall be of moisture resistant 
construction and insulated for the maxi- 
mum voltage supplied to the ride. 

(4) Grounding. Grounding of rides shall be 
by means of one or more grounding 
electrodes driven at the generator or other 
service. The grounding conductor to each 
junction box shall be of sufficient size to 
carry the maximum voltage generated by 
the system. Grounding conductors to 
each ride shall not be less than No. 8 awg. 
wire size. 

(b) Protection of Employees. No employee 
shall be suffered or permitted to work in such 
proximity to any part of an electric power circuit 
that he may contact the same in the course of his 
work, unless he is protected against shock by 
de-energizing the circuit, grounding it or guarding 
it, by effective insulation. If protection is sup- 
plied by de-energizing the circuit, the switch 
controlling the circuit shall be locked out to pre- 
vent inadvertent closing. 

(c) High Voltage Lines. The outlets of electric 
power lines carrying more than 120 volts shall 
be clearly marked to show their voltage. 

(d) Transformers. All electrical transformer 
sub-stations shall be properly enclosed and 
proper warning signs posted. 

(e) Outdoor Apparatus and Wiring. Electrical 
apparatus and wiring located outdoors shall be 
of such quality and so constructed or protected 
that exposure to weather will not interfere with 
its normal operation. 

(f) Elevated Lines. Elevated power lines 
crossing access or other roads within the grounds 
of a carnival, fair or amusement park shall be so 
suspended as to provide minimum vertical clear- 
ance of 12 feet from the road surface and mini- 
mum horizontal clearance of three feet on each 
side of the normal passage space of vehicles. 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1717 



PROPOSED RULES 



(g) Grounding. Temporary electric installa- 
tions shall be properly grounded. 

(h) Exposed Conductors. Bare wires and other 
uninsulated current-carrying parts shall be 
guarded against inadvertent contact by means of 
proper location or by fence or other barrier. 

(i) Overcurrent Protection. Conductors shall 
be provided with overcurrent protective devices 
according to load. No such device shall be in- 
stalled in neutral or grounding conductors. 

(j) Generator Grounding. Where electrical 
power is supplied for an amusement device or a 
temporary structure by a privately operated gen- 
erating system, the generator and all equipment 
shall be properly grounded if the system incor- 
porates a ground. 

(k) Receptacles and Caps. All receptacles and 
attachment caps shall be of the ground type. 

(1) Abrasion Protection. Wiring laid on sur- 
faces traversed by vehicular or pedestrian traffic 
shall be adequately protected against wear and 
abrasion. 

Statutory Authority G.S. 95-111.4. 



.0429 GO KARTS 

(a) Kart Design. 



The design of all karts man- 



ufactured after 1 9SS shall conform to all industry 
accepted standards of safety known and available 
at the time of manufacture. Karts manufactured 
prior to 19S9 shall be upgraded to at least meet 
the 1*^89 standards. All karts shall comply with 
the following minimum standards. 

( 1 ) Numbering of Karts. Each shall be pro- 
\idcd an idcntihing number that can be 
easily seen by the operator. A corre- 
sponding number shall be stamped or at- 
tached to the frame of the kart. 

(2) Speed. Kart speed shall not exceed the 
maximum speed for which the track is 
designed. The speed of adult karts shall 
be set not to exceed 28 miles per hour 
unless approved by the Department. 
Kiddie karts shall not exceed 10 miles per 
hour. When a kart is designed to permit 
the readjustment of its maximum speed, 
the means of adiustment shall not be ac- 
cessible to the driver of the kart. 

(3) Seats. The seat, back rest, and leg area 
of all karts shall be designed to re tarn the 
driver occupants uiside the kart in the 
event of a roll over or a collision at^ the 
front, rear, or side of the kart. Karts not 
so designed shall be provided with seat 
belts and shoulder straps in compliance 
with Subparagraph (a)(13) of this Rule. 

(4) Occupancy. Go karts shall be occupied 
bv onlv one person at a time unless the 



kart is designed and equipped with a seat 
and safety belt system that is intended and 
approved for two persons. 

(5) Guarding of Parts. Rotating, moving, 
hot engine or muffler parts shall be 
guarded to prevent contact or 
entanglement of the occupant's hair, 
clothing, or other body parts. 

(6) Brakes. Karts shall have a braking system 
designed and adjusted to permit them to 
be broughi to a complete stop within 40 
feet from maximum speed with their 
maximum weight on board. 

(7) Brake and Throttle Controls. Karts shall 
have brake and throttle controls that are 
readily recognizable as to their function. 
The operator shall also instruct each 
driver on the operation of the brake and 
throttle controls before each operation. 
The controls shall return automatically to 
their non-operational position when re- 
leased. 

(8) Padding or Exposed Protruding Compo- 
nents. Karts shall have their steering 
wheel hub and all other protruding ex- 
posed parts within the driving compart- 
ment padded to minimize the risk of 
injury to an occupant in the event of a 
collision or overturn. 

(9) Roll Bars and Head Rests. /Ml adult karts 
must be provided with a roll bar of suffi- 
cient height and strength to provide the 
occupant with protection in the event of 
a roll over. Seats of all karts must be 
provided with a padded head rest. The 
head rest may substitute as a roll bar if it 
is of sufficient height and strength. 



Bumpers. Go karts shall be provided 
with impact absorbing bumpers or energy 
absorption body parts. 
( 1 1) Wheel Guards. The wheels of every kart 
shall be enclosed or guarded in such a 
manner that the wheels of another kart 
cannot interlock with or nde over them. 



(12) Fuel Tanks. Kart fuel tanks shall be 
designed and mounted so that the tank 
cannot be ruptured in the event of a col- 
lision or a roll over. 

(13) Seat Belts and Shoulder Straps. Karts 
not designed in accordance with Subpara- 
graph (a)(3) of this Rule shall be provided 
with both seat belts and shoulder straps. 
Thev shall be mounted in a manner that 
will effectively rest ram the occupant(s) in 
the vehicle in case of a collision or roll 
over. Properly mounted approved safety 
harnesses may be substituted for seat belts 
and shoulder straps. 



1718 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



(14) Noise Level. Karts shall be provided 
with muffler systems capable of limiting 
sound from the engine to 75 dBA when 
measured at a distance of 50 feet from the 
outer edge of the kart track, 
(b) Track Design. Go kart track design shall 
incorporate all industry accepted standards of 
safety. Plans for proposed construction in the 
State of North Carolina shall be submitted to the 
North Carolina Department of I abor, Elevator 
and Amusement Device Division, 4 West 
Edenton Street, Raleigh, NC 2760 1 , before con- 
struction begins. Buildings on the track site must 
be submitted to the local building inspection 
agency for approval. The design of the track 
shall be consistent with kart manufacturer's rec- 
ommendations for the speed of the kart and be 
approved by the department. The following 
minimum requirements shall be complied with 
before certificates of operation will be issued. 
(1) Track Layout. Go kart tracks may be oval 
shaped or of road course configurations. 
They may not be constructed in the shape 
of a figure eight or have any cross con- 
nected points. Straight portions of the 
track shall be essentially flat except that 2 
degrees of banking may be provided for 
drainage. The width of all tracks shall be 
a minimum of 16 feet wide. Road courses 
may continue the same width for their 
entire length. Oval tracks shall have turns 
at least five feet wider than the straight 
portions and the minimum radius of the 
turns shall be 15 feet. Turns of oval 
tracks may be banked to a maximum of 
one inch for each one foot of track width. 



ill 



01 



Any variation from the minimum track 
width shall be approved in advance. 

Track Surface. A kart track shall have a 
hard smooth surface. It shall provide 
sufficient road grip to be driven through- 
out the course at maximum speed. It 
shall be free of obstacles such as holes or 
bumps, or water or oil. 

Track Materials. Materials used in the 
surfacing of kart tracks shall be asphalt, 
concrete, or other solid and binding ma- 
terials. Proposals to use dirt track sur- 
faces shall be submitted for 
consideration and evaluation. 



special 



Track Safety and Guarding. 



( 1) Barriers. Every kart track shall provide 
properly constructed barriers along the 
entire course on both inside and outside 
ot the track. Barriers shall be so con- 
structed that a kart colliding with a barrier 
at maximum speed will come to a safe 
stop or be guided back to the track. 



Earthen berms may be used as a barrier 
provided they will stop a kart safely. 
Bales of hav, straw, or other materials ca- 



01 



pable of being ignited may not be used as 
a barrier. 
(2) Track Lanes. White or yellow lines, at 
least four inches wide, shall mark all inside 
and outside edges of the track. 
Fencing. The outside perimeter of a go 
kart track shall be protected by a fence at 
least 48 inches in height. The fence shall 
be set back at least 36 inches from the in- 
side face of the track barrier. Gates shall 
be located for easy supervision by track 
attendants when the facility is open and 
they shall be kept locked when it is closed. 
The fence may be omitted where natural 
barriers provide the same degree of pro- 
tection as the fence. Where two separate 
tracks are operated inside a single perime- 
ter fence all karts on both tracks shall start 
and stop at the same time. 
Fire Extinguishers. Every go kart track 
shall be equipped with ABC Dry Chemi- 
cal Fire Extinguishers. The extinguishers 
shall have a minimum capacity of five 
pounds (Ref. NEPA-10). At least one 
extinguisher shall be located in the fol- 
lowing locations: 



(J) 



(A) Within seventy feet of every track sec- 
tion; 

(B) In each pit area; 

(C) In each refueling stop; 

(D) In each kart storage area; and 

(E) In the maintenance shop. 

Each fire extinguisher location shall be 
prominently marked and the extinguisher 
shall be easily accessible. 



{51 



Refueling Area. 



Refueling of karts shall 
be carried out at a designated area remote 
from any area accessible to the public. 
Refueling areas shall comply with the re- 
quirements of the National Electrical 
Code (NEPA-70), Sections 510, 511, and 
514. 

(6) Track Lighting. Kart tracks equipped for 
night operation shall have sufficient illu- 
mination at all sections of the track for 
drivers to be able to negotiate the entire 
course safely. It shall also be sufficient for 
operators to monitor the karts on each 
section of the course. Lighting shall 
comply with the National Electrical Code 
(NEPA-70) and all other state and local 
requirements. 

(7) Pits or Pit .Areas. Where provided, pits 
must be fenced or provided with a suffi- 
cient barrier to prohibit the entry of spec- 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1719 



PROPOSED RULES 



tators. Pits shall have separate entrance 
and exit lanes. 



(8) Spectator Areas. Spectator areas shall be 
separated from the track and pit areas by 
a fence or barrier sufficient to withstand 
the impact of a kart traveling at full speed. 
It shall be approximately level and free of 
holes or debris, 
(d) Track Operation. The following standards 
of operation shall apply to electnc or fuel pow- 
ered go karts. dune buggies, auto racers, and all 
terrain vehicles. 



Ill 



m 



All karts must start and stop operation 
at the same time or a separate pit area 
shall be provided for loading and unload- 
ing purposes. 

Drivers of adult karts must be at least 48 
inches [4 feet ) tall and have a leg length 
sufficient to reach the brake and throttle 
controls when seated. 



(3) Drivers of kiddie karts shall not exceed 
54 inches (4 feet 6 inches) tall and must 
have a leg length sutficient to reach the 
brake and throttle controls when seated. 



(4) Adult karts and kiddie karts shall not be 
operated simultaneously on the same 
track. 

(5) No kart may be operated when weather 
conditions are such that it may affect the 
safe operation of the kart or when visibil- 
ity on the track is less than 150 feet. 

(6) Each section of a kart track shall be 
monitored during the time that any kart 
is in operation. Monitoring shall be by 
direct visual contact by the operator or 
track attendants or b^ electronic visual 
surveillance. 

A kart that is losing oil or fuel shall be 
immediately removed from the track. 

When the noise level of any kart exceeds 
the requirements of Subparagraph (a)( 14) 
of this Rule, it shall be immediately re- 
moved from the track until it has been 



ill 

m 

(21 

LiPi 



repaired. 

Safety' equipment such as helmets (when 
UM'd i and scat ivaramts shall be approved 
for the type of use or operation and be of 
correct size for the person using it 

Persons with hair longer than shoulder 
length or wearing loose clothing that 
could obstruct the vision of the driver or 
become entangled in any moving part 
shall not be permitted to drive or ride a 
go kart. Long hair may be tied up to rej_ 
duce its length. 



alcohol shall not be permitted to drive a 
go kart. 

( 12) Smoking shall not be permitted while in 
the vicinity of a go kart. 

(13) Track regulations shall not permit per- 
sons to leave their karts while any kart is 



(14 



in operation on the track. 

Signs containing the following informa- 
tion and other track regulations shall be 
posted at the track entrance or ticket 
window and conspicuously in the p_it area. 

(A) To drive or ride an adult kart you must 
be at least 48 inches tall. 

(B) To dnve a kiddie kart vou may not be 
taller than 54 inches. 

(C) Keep both hands on the wheel at all 
times. 

(D) Keep both feet inside the kart. 

(E) Hau longer than shoulder length must 
be tied up. 

(E) All loose clothing must be tucked in. 
(G) No smoking in kart or in pit area. 
(H) Do not leave the kart while on the 
track. 
(15) Signs that indicate the direction of travel 
for karts shall be posted at various lo- 
cations around the track perimeter, 
(e) Inspections and Maintenance. Tracks and 
karts shall be inspected and maintained for a safe 
operation at all times. The following inspections 
shall be made: 

( 1) The track shall be inspected daily for 
potholes, bumps or loose material. Nec- 
essary repairs shall he made before open- 
ing the track. 

(2) Daily inspections shall be made on each 
kart prior to operation. The inspection 
shall include but not be limited to: 

m 
cm 

(El 

(G) 

on 



Wneel and tires 



Steering mechanism; 

Frame welds; 

Axles and spindles; 

Safety belts, roll bars, and seat padding: 

Gasoline tank, lines and valves; 

Brake and throttle operation: and 

Exhaust systems. 



(11) Persons whose behavior appears to be 
impaired by such as the use of drugs or 



(3) Go kart maintenance shall be performed 
as recommended by the kart manufacturer 
or as approved bv the North Carolina 
Department of Labor. 

Statutory Authority G.S. 95-1 1 1.4. 

TITLE 15A - DEPARTMENT OF 

ENVIRONMENT, HEALTH, AND 

NATURAL RESOL RCES 



1720 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



IS otice is hereby given in accordance with G.S. 
150B-2I.2 that the Environment, Health, and Na- 
tural Resources/ Division of Land Resources in- 
tends to amend rule(s) cited as ISA NCAC SB 
.OOOS. 

1 he proposed effective date of this action is May 
1, 1992. 

1 he public hearing will be conducted at 10:00 
a.m. on March 5, 1992 at the Ground Floor 
Hearing Room, Archdale Building, S12 North 
Salisbury Street, Raleigh, North Carolina 2761 1 . 

J\eason for Proposed Action: To add a condi- 
tion which may be included in mining permits to 
require visual screening at mine sites between any 
affected land and any adjoining property contain- 
ing occupied buildings or public access within view 
of the affected land. 

K^omment Procedures: All persons interested in 
these matters are invited to attend the public 
hearing. Written comments may be presented at 
the public hearing or submitted to Mr. Tracy E. 
Davis, Division of Land Resources, Land Quality 
Section, P. O. Box 27687, Raleigh, NC 
27611-7687, (919) 733-4574. Please notify Mr. 
Davis prior to the public hearing if you desire to 
speak. Oral presentation lengths may be limited 
depending upon the number of people that wish to 
speak at the public hearing. Written comments 
will be received for 30 days after publication of the 
notice. 

CHAPTER 5 - MINING: MINERAL RESOURCES 

SUBCHAPTER 5B - PERMITTING AND 
REPORTING 

.0005 CONDITIONS WHICH MAY 
BE INCLUDED IN PERMIT 

To assure that the operation will comply fully 
with the requirements and objectives of the 
Mining Act of 1971, the director may approve 
an application or reclamation plan subject to 
certain conditions. 

Such conditions of application approval may 
include: 

(1) additional erosion control measures to be 
installed during the mining operation; 

(2) a natural buffer to be left between any 
stream and the affected area; land; 

(3) visual screening such as existing natural 
vegetation, vegetated earthen berms, tree 
plantings at staggered spacing, etc. to be in- 



stalled and maintained as feasible between 
any affected land and any adjoining property 
containing occupied buildings or public ac- 
cess within view of the affected land; 

(4) (3) erosion control measures to be taken 
during the construction and operation of all 
haul roads or access roads to minimize off- 
site damage from sediment; 

(5) (4) other conditions necessary to safeguard 
the adjacent surface resources or wildlife. 

Statutory Authority G.S. 74-51; 74-63. 

TITLE 16 - DEPARTMENT OF PUBLIC 
EDUCATION 



IS otice is hereby given in accordance with G.S. 
150B-21.2 that the State Board of Education in- 
tends to adopt rule(s) cited as 16 NCAC 6G 
.0401 - .0403. 

1 he proposed effective date of this action is June 
1, 1992. 

1 he public hearing will be conducted at 10:00 
a.m. on March 6, 1992 at the 3rd Floor Board 
Room, Education Bldg., 116 West Edenton Street, 
Raleigh, NC 27603-1712. 

iXeason for Proposed Action: 1991 General As- 
sembly enacted legislation relating to low per- 
forming school units and directed State Board to 
adopt implementing regulations. 



Cc 



comment Procedures: Any interested person 
may submit views either in writing prior to or at 
the public hearing or orally at the hearing. 

CHAPTER 6 - EUEMENTARY AND 
SECONDARY EDUCATION 

SUBCHAPTER 6G - EDUCATION AGENCY 
RELATIONS 

SECTION .0400 - LOW PERFORMING SCHOOL 
UNITS 

.0401 DEFINITIONS 

(a) A "low performing school unit" is one that: 

(1) does not meet 75 percent of the SBE ac- 
creditation standards at Level J_^ 

(2) ranks in the lower 23rd percentile in stu- 
dent achievement on the most recent Re- 
port Card issued by the SBE under the 
authonty of G.S. 1 15C-12(9)cl.; and 

(3) has a dropout rate that is at least one 
standard deviation above the average 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1721 



PROPOSED RULES 



dropout rate for all school units in the 

state, 
(b) A "school unit on warning status" is one 
that meets any two of the conditions described 
m Paragraph (a) of this Rule, except as provided 
in Rule .0403(1) of this Section. 

Statutory Authority G.S. 1 15C-64.5. 

.0402 IMPROVEMENT PLANS 

(a) The SBE will determine which school units 
are to be designated either as low performing or 
on warning, status by its February' meeting of 
each year. The SBE will also notify those units 
of such designation immediately after the desig- 
nation is made. 

(b.) The Department will notify units of services 
available to assist them immediately after those 
units are notified of their designation as low per- 



forming by the SBE. School units on warning 
status receive priority for technical assistance 
from the Department after that assistance has 
been provided to low performing units as de- 
scribed in this Rule. These services will be co- 
ordinated through the technical assistance center 
that serves the area where the school unit is lo- 
cated. The Department will provide additional 
funds to these units pursuant to G.S. 
1 15C-64.2(b) from such discretionary funds as 
are available to the Department for this purpose. 

(c) Each identified unit must submit an im- 
provement plan to the Department by May 15 
following identification, for transmittal to the 
SBF. The SBE will review plans and act upon 
requests for waivers under G.S. 1 15C-64.2(a) at 
its next regularly scheduled meeting. Identified 
units may submit additional requests for waivers 
to the SBF at anv time that such waivers are 
needed. 

(d) After the SBE has reviewed the improve- 
ment plan and has acted upon waiver requests, 
the Department will prepare and release the re- 
port for each identified unit as required by G.S. 
115C-64.3(b). 



Statutory Authority G.S. 1 15C-64.5. 

.0403 CARETAKER ADMINISTRATORS AND 
BOARDS 

(a) At its January meeting of each year, the 
SBF will review student performance data and 
student dropout rates for low performing school 
units for the two complete academic years that 
follow the unit's submission of an improvement 
plan under Rule .0402 of this Section. If the 
SBF finds that the unit has not made progress so 
as to have the low performing designation re- 
moved under Paragraph (_h_ of this Rule, the 



Board will appoint a caretaker administrator, a 
caretaker board, or both. These appointments 
are effective the next working day following the 
appointment unless the SBE designates other- 
wise. 

(b) Before appointing caretaker administrators 
or boards, the SBE will accept nominations from 
education-related organizations in the state. The 
SBE will establish a registry of caretaker admin- 



istrator and board members from these and from 
names supplied by the SBE. The SBE will make 
appointments from this registry. 

(c) Caretaker administrators serve under con- 
tract with the SBE. Caretaker board members 
serve at the pleasure of the SBF. Both caretaker 
administrator-- and board member are appointed 
for an initial term of two years and may be re- 
appointed for additional one-vear terms at the 
discretion of the SBE. The SBE may remove 
any person appointed under this Rule at anv time 
for cause. 

(d) Caretaker administrators appointed by the 
SBE are entitled to participate in the state retire- 
ment system and to earn and use vacation leave, 
sick leave, insurance and other benefits that are 
available to state employees. 

(e) If the SBE appoints only caretaker admin- 
istrators, those persons will perform all the pow- 
ers and duties , assigned bv law to local 
superintendents and or finance officers as speci- 
fied in their contracts with the SBE'. 

(f) If the SBE appoints only a caretaker board, 
the Board will perform all the powers and duties 
assigned bv law to local boards of education, in- 
cluding the appointment of administrators. 

(g) If the SBE appoints both a caretaker board 
and one or more caretaker administrators, the 
administrators perform under the direction of the 
caretaker board. 

(h) If the SBE appoints a caretaker board, the 
incumbent board members will retain their of- 
shall contmue to be held ac- 
dutv 



of the 



fiees and election 
cording to law, but the onlv 
incumbent board is to advise and assist the care- 
taker board. If the SBF appoints caretaker ad- 
miniMraUTv the incumbent board ma'. 
determine whether to contmue the employment 
of the incumbent administrators, but the 
incumbent board must pay the salaries of such 
administrators from local funds. The onlv dutv 
of an incumbent administrator is to advise and 
assist the caretaker administrators. 

(i) A low performing school unit mav be re- 
moved from that designation and the operation 
of the unit will be returned to the local school 
Kurd onl\ if the MU timF that the unit hav met 
anv two of the following three criteria: 



ri2 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



Q] the unit 



the unit becomes eligible for state accredi- 
tation under Section .0200 of this Sub- 



chapter; 

(2) the unit reaches the state average range in 
overall achievement under the Report 
Card; and 

(3) the unit's student dropout rate has de- 
creased to less than one standard deviation 
above the average dropout rate for all 
school units in the state. 

Statutory Authority G.S. II5C-64.5. 

TITLE 21 - OCCUPATIONAL LICENSING 
BOARD 



IVotice is hereby given in accordance with G.S. 
150B-21.2 that the N.C. State Board of Cosmetic 
Art Examiners intends to repeal rule(s) cited as 
21 NCAC 14L .0/07; and adopt rule(s) cited as 
21 NCAC I4N .0101 - .0114, .0201 - .0202, .0301 
- .0302, .0401 - .0402, .0501 - .0502. 

1 he proposed effective date of this action is May 
1, 1992. 

1 he public hearing will be conducted at 10:00 
a.m. on March 16, 1992 at the Grove Towers, 
Fifth Floor, 1/10 Navaho Drive, Raleigh, N.C. 



Re 



reason for Proposed Action: 2/ NCAC 14L 
.0107 - Material in this Rule is included in pro- 
posed adoption of 21 NCAC I4N .0113(d). 21 
NCAC 14N .0101 - .01/4, .0201 - .0202, .0301 - 
.0302, .0401 - .0402, .0501 - .0502 - This Cosmetic 
Art Board has never had examination rules, and 
it proposes these Examination Rules so the exam- 
ination applicants and the public will know exactly 
what is expected for the Cosmetic Art Examina- 
tions. 

O omment Procedures: The record shall be open 
for 30 days to receive written comments. Written 
comments should be received by the N.C. State 
Board of Cosmetic Art Examiners by March 20, 
1992, to be considered as part of the hearing re- 
cord. Comments should be addressed to Vicky 
R. Goudie, Executive Secretary, N.C. State Board 
of Cosmetic Art Examiners, 1110 Navaho Dr., 
Raleigh, N.C. 27609. Requests to speak must be 
in writing and received by March II, 1992 prior 
to hearing. Speaking time 10 minutes. 

CHAPTER 14 - BOARD OF COSMETIC ART 
EXAMINERS 



SUBCHAPTER 14L - COSMETIC ART 
TEACHERS 

SECTION .0100 - TEACHER QUALIFICATIONS 
AND EXAMINATIONS 

.0107 PASSING SCORE RE-EXAMINATION 

/ <-t \ A n <-n-.«-tli,-».-i«-i , t rv\ 1 1 ff o^^^j-^ «-> + I^i^£* V ^ r\ y\ ftn^h 

part af- tbe appropriato teacher's oxamination a> 

(b} A» applicant who feite the oxamination 
twico aiay He* take the oxamination again until 
the applicant tak e s additional cosmetology e* 
manicurist courses ©f takes other otopo te ia- 
cr e as e the lilcolihood that the applicant wai pass 

l i~- \ IKa l-j i~\ r\ t»,H ^otaj^TTiija^ ^J^A 'li l i ' l U l'li' V i 1 1 • t i t T"V ' 

taken by aa applicant pursuant ta Paragraph (b) 

."\ «-i «i /■"M-rt Kir .— Ofj-^ V\r\ Q i c t ■-» 1 .- -i n rt intn .-'Afi fii-lf iffitirin 
^^^T CT CfUV^J Is J LU^J Uli. J1J , ECCXvXI 1C, rTTT^T IU11JIUU1 U 1 1 U 1 1 

the amount by which the applicant failod the ex- 
amination aa4 othor relevant factors. 

Statutory Authority G.S. 88-23. 

SUBCHAPTER 14N -EXAMINATIONS 

SECTION .0100 - GENERAL PROVISIONS 

.0101 TIME AND PLACE OF 
EXAMINATIONS 

(a) The Board shall hold examinations in its 
offices in Raleigh. 

(b) In addition to the examinations held in 
Raleigh pursuant to Paragraph (a) of this Rule, 
the Board shall conduct other examinations 
throughout the year at no less than three lo- 
cations other than Raleigh. 



(c) The Board shall announce the time and 
place for holding each examination at least ten 
work days prior to the date thereof. 

Statutory Authority G.S. 88-10(2); 88-12(2); 
88-16; 88-/7; 88-21 (a) (16); 88-23; 88-30(4). 

.0102 INITIAL APPLICATIONS AND FEES 

(a) All applications for examination must be 
on a form provided by the Board. 

(b) If an interpreter or other special arrange- 
ments are required, the initial application to take 
an examination must include, as appropriate: 

(1) An application for an interpreter pursuant 
to 21 NCAC 14N .0106, or 



(21 

ih 



An application for special arrangements 
pursuant to 21 NCAC 14N .0107, or 



Both applications described in Subpara- 
graphs (a)(1) and (2) of this Rule. 
The application must be filed with the 
Board and accompanied by the applicable exam- 
ination fee. If the application is not signed or is 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1723 



PROPOSED RULES 



inadequately completed, or the proper support- 
ing documentation is not enclosed, or the appli- 
cable fee is not paid, the application shall be 
deemed incomplete and returned. 

(d) If the examination fee is paid by check or 
money order, the check or money order shall be 
made payable to the "Board of Cosmetic Art 
Examiners". 



(e) If at all possible, the Board will schedule 
candidates whose properly completed applica- 
tions are receiycd by the 10th of one month to 
the examination during the following 



take 
month 



The Board will assign the candidate to 
the location nearest to the candidate that is 
ayailable for that month. 



(f) Candidates for licensure as an apprentice 
cosmetologist shall take the cosmetologist exam- 
ination. 



Statutory Authority G.S. 88-10(2); 88-12(2); 
88-16; 88-17; 88-21 (a)( 16); 88-23; 88-30(4). 

.0103 GENERAL EXAMINATION 
INSTRUCTIONS 

(a) All candidates scheduled for an examination 
are required to bring: 

( 1 ) their social security number. 



(21 

ill 



a form of identification with a current 
picture, 

a kit containing all supplies necessary to 
perform all services required by the ex- 
amination, and 
(4) No. 2 pencils. 

(b) Candidates for the cosmetologist examina- 
tion shall bring either a live model or mannequm 
that conforms with the applicable requirements 
set forth in 21 NCAC 14N .0104 and .0105. 

(c) Candidates for the cosmetologist teacher 
examination shall bring either four live models 
or four mannequins that conform with the ap- 
plicable requirements set forth in 2J_ NCAC 14N 
.0104 and .0105; however, each candidate must 
provide a Live model for the manicurist portion 
of the examination. These live models or 
mannequins shall be suitable for demonstrating 
the full range of services required bv the 
cosmetology curriculum. 

(d) Candidates for the manicurist or manicurist 
teacher exammation shall bring a live model. 

(e) Candidates will not be accepted after roll 
call. 

(f) No candidates will be allowed to bring 
books, calculators, papers, or reference materials 
of anv kind into the testing room, except as pro- 
vided in Paragraph (g) of this Rule. 

(g) Cosmetology teacher and manicurist 
teacher candidates may use visual aids, prepared 
m advance, during the practical examination 



During the lesson planning part of the examina- 
tion, only a text book brought by that candidate 
may be used. 

Statutory Authority G.S. 88-10(2); 88-12(2); 
88-16; 88-17; 88-21 (a)( 16); 88-23; 88-30(4). 

.0104 LIVE MODEL REQUIREMENTS 

(a) If, pursuant to 21 NCAC 14N .0103(b) or 
(c), a candidate has chosen to bring a live model 
for the examination, the model must: 

(1) be at least 18 years old, 

(2) submit to all cosmetic art services required 
by the examination, and 

(3) agree to a haircut of at least one to one 
and one-half inches during the examina- 
tion. Hair must be of sufficient length to 
perform requirements after cutting. Prior 
to the examination, the model's hair must 
have already been shampooed, set and 
dried. 

(b) A model brought bv a candidate for the 
manicurist or manicurist teacher examination, 



pursuant to 2]_ NCAC 14N .0 103(d) shall: 

(1) be at least 18 years old, 

(2) submit to all cosmetic art services required 
by the examination. 

(c) Cosmetic art school or shop owners, regis- 
tered or apprentice cosmetologists, manicurists, 
cosmetology or manicurist teachers, salon opera- 
tors, and present or former cosmetology or 
manicurist students may not sit as models. 

(d) No model mav sit for more than one can- 
didate at one exam. 

Statutory Authority G.S. 88-10(2); 88-12(2); 
88-16; 88-17; 88-21 (a)( 16); 88-23; 88-30(4). 

.0105 MANNEQUIN REQUIREMENTS 

(a) If, pursuant to 21 NCAC 14N .0103(b) and 
(c), a candidate has chosen to bring a mannequin 
for the examination, the mannequin's hair shall 
be of sufficient length for the candidate to per- 
form at least a one to one and one-half inch 
haircut. Hair shall be of sufficient length to per- 
form requirements after cutting. The candidate 
shall bring a holder for the mannequin. 

(b) Prior to the examination, the mannequin's 
hair shall have already been shampooed, set and 
dried. 

(c) When a manicure is required during the 
cosmetologist examination, the candidate who 
has brought a mannequin rather than a model 
shall perform the manicure on another candidate. 

(d) Except as provided in Paragraph (c) of this 
Rule, all required services shall be done on one 
mannequin. 



1~24 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



Statutory Authority G.S. 8< 
88-16; 88-17; 88-21 (a)( 16); 



■10(2); 88-12(2); 
8-23; 88-30(4). 



Statutory Authority G.S. 81 
88-16; 88-17; 88-21(a)( 16); 



■10(2); 88-12(2); 
8-23; 88-30(4). 



.0106 USE OF AN INTERPRETER 

(a) A candidate whose native language is not 
English may apply for permission to bring, an 
interpreter to the examination, if the candidate is 
unable to speak, read, or write English at a tenth 
grade level. 

(b) The interpreter shaLl be: 

( 1) 18 years old or older, and 

(2) fluent in both English and the candidate's 
native or other language. 

(c) An interpreter shall not: 

(1) be currently or formerly licensed by this 
state or any state, nor have received or is 



receiving any training, in an 
cosmetic art; 



(2) be a current or former owner or employee 
of any beauty establishment, 
(d) The application for permission to use an 
interpreter shall be made on a form provided by 
the Board. 

Statutory Authority G.S. 88-10(2); 88-12(2); 
88-16; 88-17; 88-21 (a)( 16); 88-23; 88-30(4). 

.0107 SPECIAL ARRANGEMENTS FOR 
DISABLED 

(a) If a candidate has a disability which will 
require special arrangements to take an examina- 
tion, the candidate shall request such arrange- 
ments in his or her initial application for 
examination. The request for special arrange- 
ments shall be in writing and shall set out in 
sufficient detail what special arrangements are 
needed. The Board shall make reasonable ac- 
commodations for candidates requesting assist- 
ance under this Section. 

(b) If reading assistance or an interpreter is re- 
quired, the application for special arrangements 
shall also be accompanied by a letter from the 
candidate's cosmetic art school which documents 
the assistance the candidate required during 
classes there. If the candidate is unable to obtain 
a letter from a cosmetic art school, then the can- 
didate shall submit a letter from a qualified pro- 
fessional as determined by the Board. 

(c) In all other cases, the application for special 
arrangements shall be accompanied by a letter 
from a professional qualified to diagnose and 
document the disability. 

(d) The candidate shall provide any special 
equipment or interpreters. An interpreter shall 
be ]_8 years of age or older and meet the require- 
ments of 2J_ NCAC 14N .0106(a). 



.0108 FAILURE TO APPEAR FOR 
EXAMINATION 

(a) If a candidate fails to appear for the sched- 
uled examination, the examination fee shall not 
be refunded. 



(b) Notwithstanding Paragraph (a) of this 
Rule, the examination fee may be refunded to a 



candidate who has failed to appear for the ex- 
amination if verification of good cause for failing 
to appear is mailed to the Board within seven 
days of the examination date, 
(c) Determination of "good cause" under this 
Rule is within the Board's discretion. 



branch of [dj "Good cause" includes events beyond the 



control of the candidate which prohibited him 
or her from attending the examination. Exam- 
ples of good cause are serious personal illness or 
accident, and death or serious illness in the im- 
mediate family. 

(e) Acceptable verification of good cause is any 
written communication from a person not related 
to the candidate which would tend to support the 
candidate's stated reason for failing to attend the 
examination. Some examples of acceptable ver- 
ifications would include a statement from an at- 
tending physician, an official accident report or 
an obituary notice. 

(f) The license fee shall be credited to the can- 
didate's account unless candidate notifies the 
Board in writing that he or she does not wish to 
re-applv. In that case, the license fee shall be 
refunded. 

Statutory! Authority G.S. 88-/0(2); 88-12(2); 
88-16; 88-17; 88-21; 88-23; 88-30(4). 

.0109 OBSERVATION OF EXAMINATION BY 
THIRD PARTIES 

No visitors shall be allowed in the examination 
room during the examinations. 

Statutory Authority G.S. 88-10(2): 88-12(2); 
88-16; 88-17; 88-21 (a)( 16); 88-23; 88-30(4). 

.0110 PASSING GRADES FOR EXAMINATION 

Candidates shall make the following grades on 
both the practical and theory sections of the ex- 
amination: 

( 1) for licensure as a registered cosmetologist, 
75 percent; 

(2) For licensure as an apprentice 
cosmetologist, 70 percent; 

(3) For licensure as a cosmetology teacher, 85 
percent; 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1725 



PROPOSED RULES 



(4) For licensure as a manicurist teacher, 85 
percent; 

(5) For licensure as a registered manicurist, 75 
percent. 



Statutory Authority G.S. 8 
88-17; 88-21 (a) (16); 88-23; 



1-10(2); 88-12(2); 
88-30(4); 93B-8. 



son shall copy a question or answer contained in 
the examination report or alter an examination 
paper in any way. 

Statutory Authority G.S. 88-10(2); 88-12(2); 
88-16; 88-17; 88-21 (a) ( 16); 88-23; 88-30(4); 
93B-8. 



.01 1 1 NOTIFICATION OF EXAM RESULTS 

(a) The examination results shall be mailed to 
the candidate at the address on the application 
form within 30 days of the examination. 

(b) If the candidate wishes to have the exam- 
ination results mailed to an address different from 
the one on the application form, the new address 
shall be received by the Board within five days 
after the examination. 

(c) Any cosmetology student who completed 
a 1500-hour course and failed to make the re- 
quired 75 percent on both parts of the 
cosmetology examination, but scored at least 70 
percent on both parts, may send a written request 
for an apprentice cosmetologist license, along 
with the required fee, instead of taking the exam 
again. In this case, the candidate shall not be 
given credit toward apprentice time until the date 
the written request and appropriate fee are re- 
ceived in the office. Notice shall be sent, with the 
license, advising the applicant of the starting date 
of the apprenticeship. 



Statutory Authority G.S. 8> 
88-16; 88-17; 88-21 (a)( 16); 



■10(2); 88-12(2); 
8-23; 88-30(4). 



.0112 REVIEW OF EXAMINATION 

(a) A candidate who has failed the practical 
section of an examination may review his or her 
.grading sheets for that section at the Board's of- 
fice in Raleigh. However, a candidate may not 
review the theory section of an examination. 



(b) A candidate who has passed both sections 
of an examination at any level may not review 
his or her examination papers. 

(c) In order to review the practical section 
grading sheets for his or her examination, a can- 
didate shall file a written request with the Board 
not more than 30 days after the date of notice of 
the examination results was mailed. If the re- 
quest is received by the 10th of the month, the 
review will be the next month. Once a request 
is sent to the Board office, the Board will notify 
the candidate of an appointment time and date. 
The candidate shall confirm the time and date at 
least seven days before appointment time or tune 
may be canceled. 

(d) The review authorized by Paragraph (a) of 
this Rule shall be under the supervision of an 
authorized representative of the Board. No per- 



.0113 RE-EXAMINATION 

(a) If, upon application for re-examination, the 
applicant has taken and passed one section of an 
examination, he or she shall apply for re- 
examination only on the section of the examina- 
tion which he or she did not pass. 

(b) Applicants for re-examination must apply 
for re-examination in writing and pay the appro- 
priate examination fee. 

(c) Notwithstanding any other provision of 
these Rules, pursuant to G.S. 88-16(4), a 
cosmetology candidate, having failed either sec- 
tion of the examination five times, is required to 
complete an additional 200 hours of study at an 
approved cosmetic art school before another ap- 
plication for re-examination may be accepted by 
the Board. 

(d) Any candidate for the cosmetology teacher 
examination, who fails the examination twice, 
must meet the following requirements before 
taking the examination again: 

(1) Any candidate who failed the practical 
portion must request an examination re- 
view, and must complete no less than 200 
hours in a teacher training course. 

(2) The course of study for that candidate 
must be designed to address the candi- 
date's deficiencies. 



(e) Upon written request by any candidate, the 
Board shall release a summary of the results of 
each category of the practical section of the most 
recent examination to the school in which the 
candidate is enrolled for the additional study, 
pursuant to G.S. 
this Rule. 



■ 16(4) or Paragraph (d) of 



(f) The school in which the student has en- 
rolled pursuant to G.S. 88-16(4) shall design a 
course of study for that student in order to cor- 
rect the student's deficiencies. The course of 
study must be submitted to the Board for ap- 
proval. 

Statutory Authority G.S. 88-10(2); 88-12(2); 
88-16; 88-17; 88-21 (a)( 16); 88-23; 88-30(4). 

.0114 FAILURE TO COMPLY WITH CHAPTER 

(a) The examiner may dismiss from the exam- 
ination any candidate who fails to comply with 
this Chapter or who disrupts the examination. 



1726 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



PROPOSED RULES 



(b) With respect to fees only, a candidate who 
has been dismissed pursuant to Paragraph (a) of 
this Rule, will be treated as though the candidate 
has failed to appear. 

Statutory Authority G.S. 88-10(2); 88-12(2); 
88-16; 88-17; 88-21 (a)( 16); 88-23; 88-30(4). 



The practical section of the manicurist exam- 
ination shall require the candidate to perform 
procedures which will test the basic knowledge 
and skills necessary to practice as a manicurist 
and shall be related to the curriculum required 
by the Board to be taught in approved cosmetic 
art schools to manicurist students. 



SECTION .0200 - COSMETOLOGIST EXAM 

.0201 EXAMINATION - THEORY SECTION 

(a) The theory section of the cosmetologist 
examination shall include the national theory 
examination of the National Interstate Council 
of State Boards of Cosmetology which covers all 
phases of cosmetic art, including hairdressing, 
manicuring and pedicuring, facial massage, and 
sanitation. The theory section also covers North 
Carolina laws governing the practice of cosmetic 
art. 

(b) The candidate shall have two and one half 
hours to complete the theory section of the 
cosmetologist examination. 



Statutory Authority G.S. 
88-17. 



88-10(2); 88-12(2); 



Statutory Authority G.S. 88-17; 88-30(4). 

SECTION .0400 - COSMETOLOGIST TEACHER 
EXAMINATION 

.0401 EXAMINATION - THEORY SECTION 

(a) The theory section of the cosmetology 
teacher examination shall include the national 
theory examination of the National Interstate 
Council of State Boards of Cosmetology which 
includes lesson plans, teaching techniques, 
teaching aids, testing, classroom management, 
and student motivation. The theory section will 
also cover North Carolina laws governing the 
practice of cosmetic art. 

(b) The candidate shall have two and one-half 
hours to complete the theory section of the ex- 
amination. 



.0202 EXAMINATION - PRACTICAL 
SECTION 

The practical section of the cosmetologist ex- 
amination shall require the candidate to perform 
procedures which will test the basic knowledge 
and skills necessary to practice as a cosmetologist 
and shall be related to the curriculum required 
by the Board to be taught in approved cosmetic 
art schools to cosmetology students. 

Statutory Authority G.S. 88-10(2); 88-12(2); 
88-17. 



Statutory Authority G.S. 
88-23. 



■17; 88-21 (e) (16); 



.0402 EXAMINATION - PRACTICAL 
SECTION 

The practical section of the cosmetology teach- 
er's examination shall require the candidate to 
perform procedures which will test the basic 
knowledge and skills of teaching techniques. 

Statutory Authority G.S. 88-17; 88-21 (a) ( 16); 
88-23. 



SECTION .0300 - MANICLRIST EXAMINATION 

.0301 EXAMINATION - THEORY SECTION 

(a) The theory section of the manicurist ex- 
amination shall include the national theory ex- 
amination of the National Interstate Council of 
State Boards of Cosmetology which covers all 
phases of the art of manicuring, pedicuring and 
sanitation. The theory' section will also cover 
North Carolina laws governing the practice of 
cosmetic art. 

(b) The candidate shall have two and one-half 
hours to complete the theory section of the 
manicurist examination. 

Statutory Authority G.S. 88-17; 88-30(4). 

.0302 EXAMINATION - PRACTICAL 
SECTION 



SECTION .0500 - MANICLRIST TEACHER 
EXAMINATION 

.0501 EXAMINATION - THEORY SECTION 

(a) The theory section of the manicurist teacher 
examination shall include the national theory 
examination of the National Interstate Council 
of State Boards of Cosmetology, which includes 
lesson plans, teaching techniques, teaching aids, 
testing, classroom management, and student 
motivation. I'he theory section will also cover 
North Carolina laws governing the practice of 
cosmetic art. 

(b) The candidate shall have two and one-half 
hours to complete the theory section of the ex- 
amination. 



Statutory Authority G.S. 88-17; 88-21 (e)( 16); 
88-23. 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1727 



PROPOSED RULES 



form procedures which will test the basic know- 
.0502 EXAMINATION - PRACTICAL ledge and skills ot teaching techniques. 

SECTION 

The practical section of the manicurist teacher's ^tatut ory A uthority G.S. 88- 1 7; 88-21 (a) (16); 

examination shall require the candidate to per- 



1728 6:22 NORTH CAROLINA REGISTER February 14, 1992 



FINAL RULES 



/l dopted rules fded by the Department of Revenue are published in this section. This department 
is not subject to the provisions of G.S. 1S0B, Article 2 requiring publication in the N.C. Register of 
proposed rules. 

LLffective October I, 1991 , the Departments of Correction and Revenue are subject to G.S. I50B, 
Article 2A. 

LJ pon request from the adopting agency, the text of rules will be published in this section. 



TITLE 17 
DEPARTMENT OF REVENUE 

CHAPTER I 
DEPARTMENTAL RULES 

SUBCHAPTER IC - GENERAL ADMEMSTRATION 

SECTION .0400 - ENTEREST REQUIREMENTS 

.0402 ESTABLISHED rNTEREST RATES 

(a) For the calendar years 1978 and 1979, the Secretary of Revenue under authority of Subsection 
(i) of G.S. 105-241.1 has established an interest rate of six percent per annum in conformance with the 
adjusted rate established under Section 6621 of the United States Internal Revenue Code. The com- 
putation shall be at the rate of one-half percent per month or fraction thereof. 

(b) For the calendar years 1980 and 1981, the Secretary of Revenue under authority of Subsection 
(i) of G.S. 105-241.1 has established an interest rate of twelve percent per annum in conformance with 
the adjusted rate established under Section 6621 of the United States Internal Revenue Code. The 
computation shall be at the rate of one percent per month or fraction thereof. 

(c) For the calendar year 1983, the Secretary of Revenue under the authority of Subsection (i) of G.S. 
105-241.1 has established on November 29, 1982 an interest rate of nine percent per annum. The 
computation shall be at the rate of three-fourths percent per month or fraction thereof. 

(d) For the calendar year 1984, the Secretary of Revenue under the authority of Subsection (i) of 
G.S. 105-241.1 has established on November 29, 1983 and interest rate of nine percent per annum. 
The computation shall be at the rate of three-fourths percent per month or fraction thereof. 

(e) For the calendar year 1985, the Secretary of Revenue under the authority of Subsection (i) of G.S. 
105-241.1 has established on November 19, 1984 an interest rate of 9 percent per annum. The com- 
putation shall be at the rate of three-fourths percent per month or fraction thereof. 

(f) For the calendar year 1986, the Secretary of Revenue under the authority of Subsection (i) of G.S. 
105-241.1 has established on October 25, 1985 an interest rate of nine percent per annum. The com- 
putation shall be at the rate of three-fourths percent per month or fraction thereof. 

(g) For the calendar year 1987, the Secretary of Revenue under the authority of Subsection (i) of 
G.S. 105-241.1 has established on November 18, 1986 an interest rate of nine percent per annum. The 
computation shall be at the rate of three-fourths percent per month or fraction thereof. 

(h) For the calendar year 1988, the Secretary of Revenue under the authority of subsection (i) of G.S. 
105-241.1 has established on November 30, 1987 an interest rate of nine percent per annum. The 
computation shall be at the rate of three-fourths percent per month or fraction thereof. 

(i) For the calendar year 1989, the Secretary of Revenue under the authority of subsection (i) of G.S. 
105-241.1 has established on November 18, 1988, an interest rate of nine percent per annum. The 
computation shall be at the rate of three-fourths percent per month or fraction thereof. 

(j) For the period January 1, 1990 through June 30, 1990, the Secretary of Revenue under the au- 
thority of subsection (i) of G.S. 105-241.1 has established on November 20, 1989, an interest rate of 
nine percent per annum. The computation shall be at the rate of three-fourths percent per month or 
fraction thereof. 



6:22 NORTH CAROLINA REGISTER February 14, 1992 1729 



FINAL RULES 



(k) For the period July 1, 1990 through December 31, 1990, the Secretary' of Revenue under the au- 
thority of subsection (i) of G.S. 105-241.1 has established on June 1, 1990, an interest rate of nine 
percent per annum. The computation shall be at the rate of three-fourths percent per month or fraction 
thereof. 

(1) For the period January 1, 1991 through June 30, 1991, the Secretary of Revenue under the au- 
thority of subsection (i) of G.S. 105-241.1 has established on December 3, 1990, an interest rate of nine 
percent per annum. The computation shall be at the rate of three-fourths percent per month or fraction 
thereof. 

(m) For the period July 1, 1991 through December 31, 1991, the Secretary of Revenue under the 
authority of subsection (i) of G.S. 105-241.1 has established on June 21, 1991, an interest rate of nine 
percent per annum. The computation shall be at the rate of three-fourths percent per month or fraction 
thereof. 

(nj For the period January 1, 1992 through June 30, 1992, the Secretary of Revenue under the au- 
thority of subsection (i) of G.S. 105-241.1 has established on November 15, 1991, an interest rate of 
eight percent per annum. The computation shall be at the rate of two-thirds percent per month or 
fraction thereof. This rate will remain in effect until a new rate is established. 



History Xote: Statutory Authority G.S. J 05-24 J. J; 105-262; 
Eff. Sovember 9, 1977; 

Amended Eff. February 3, 1992; January 1, 1990; 
January I, 19S9; February 1, 1988. 



1710 6:22 NORTH CAROLINA REGISTER February 14, 1992 



RRC OBJECTIONS 



1 he Rules Review Commission (RRC) objected to the following rules in accordance with G.S. 
143B-30.2(c). State agencies are required to respond to RRC as provided in G.S. l43B-30.2(d). 

1 emporary Rules are noted by "*". These Rules have already gone into effect. 



ADMINISTRATION 



State Construction 



1 NCAC 30F 
1 NCAC 30F 
1 NCAC 30F 
I NCAC30F 
1 NCAC30F 
1 NCAC30F 
J NCAC30F 
J NCAC30F 
1 NCAC30F 



.0101 
.0103 
.0202 
.030/ 
.0302 
.0303 
.0305 
.0401 
.0403 



Authority 

Definitions 

Pre-Bid Conferences and Site Reviews 

Definitions 

Overall Job Performance 

Interim Contractor Evaluation 

Report Compilation 

Post-Occupancy Evaluation 

Appeals of Assigned Eval or Disqual from Bidding 



State Employees Combined Campaign 

1 NCAC 35 .0103 - Organization of the Campaign 

Agency Revised Rule 
1 NCAC 35 .0202 - Criteria for Acceptance 

Agency Revised Rule 
1 NCAC 35 .0302 - Response 

Agency Revised Rule 



RRC 
RRC 
RRC 
RRC 
RRC 
RRC 
RRC 
RRC 
RRC 



Objection 
Objection 
Objection 
Objection 
Objection 
Objection 
Objection 
Objection 
Objection 



RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 



10/17191 
10/17/91 
10/17/91 
10/17/91 
10/17/91 
10/17/91 
10/17/91 
10/17/91 
10/17/91 



01/24/92 
01/24/92 
01/24/92 
01/24/92 
01/24/92 
01/24/92 



AGRICULTURE 

Plant Industry 

2 NCAC48E .0101 - Definitions 
Agency Revised Rule 
Agency Responded 

CRIME CONTROL AND PUBLIC SAFETY 

State Highway Patrol 

14 A NCAC 9H .0304 - Notifying Registered Owner 
No Response from Agency 

ECONOMIC AND COMMUNITY DEVELOPMENT 

Credit Union Division 

4 NCAC 6C .0311 - Surety Bond and Insurance Coverage 

Agency Revised Rule 
4 NCAC 6C .0401 - Delinquent Loans and Loan Losses 

4 NCAC6C .0402 - Charge-Off of Uncollectible Loans 



RRC Objection 10/17/91 
RRC Objection 10/17/91 
No Action 12/19/91 



RRC Objection 

No Action 



RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 



12/19/91 
01/24/92 



11/21/91 

12/19/91 
11/21/91 
12/19/91 
11/21/91 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1731 



RRC OBJECTIONS 



Agency Revised Rule 
4 NCAC6C .0403 - Real Estate Loans 

Agency Revised Rule 
4 SCAC6C MO' 7 - Business Loans 
4 XCAC6C .1301 - Liquidity Reserves 

Agency Revised Rule 

Savings Institutions Division: Savings Institutions Commission 

4 NCAC 16 A .0105 - Restrictions: Payment! Dividends Repurchase Stock 

Agency Revised Rule 
4 NCAC ISC .0402 - Application: Guidelines! Approval Administrator 

Agency Revised Rule 
4 XCAC 16C .0403 - General Policies 
4 XCAC I6D .0301 - General Policies 

Agency Revised Rule 
4 XCAC 16E .0103 - Composition of Board of Directors 

Agency Revised Rule 
4 XCAC 16E .0105 - Amendment of Converted Savings Bank's Charter 

Agency Revised Rule 
4 XCAC 16E .0301 - General Policies 

Agency Revised Rule 
4 XCAC 16E .0303 - Required Policies 

Agency Revised Rule 
4 XCAC 16E .0502 - Holding of Certificate or Passbook 

Agency Revised Rule 
4 XCAC 16G .0404 - Information Prior To Approval Plan Conversion 

Agency Revised Rule 
4 XCAC I6G .0510 - Use of Proxy Soliciting Material to be Authorized 

Agency Revised Rule 
4 XCAC 16G .0513 - Material Required to be Piled 

Agency Revised Ride 
4 XCAC I6G .0714 - Estimated Price Information: Proxy Statements 

Agency Revised Rule 
4 XCAC I6G .0~20 - Period for Completion of Sale 

Agency Revised Rule 
4 XCAC 16G .0^22 - Extensions of Time to Complete Offerings 

Agency Revised Rule 
4 XCAC I6G .0825 - Requirements as to Paper and Printing 

Agency Revised Rules 
4 XCAC 16H .0002 - Grounds 

Agency Repealed Rule 
4 NCAC 1 6H .0008 - Waiver 

Agency Revised Rule 
4 XCAC 161 .0702 - Definitions and Other Terms 

Agency Revised Rule 
4 XCAC 161 .0703 - Stds for Approval of Acquisition: Duties Conduct 

Agency Revised Rule 
4 XCAC 161 .0902 - Acquisition Procedure 

Agency Revised Rule 
4 XCAC 161 .1003 - Acquisition Procedure 

Agency Revised Rule 
4 XCAC 161 .1202 - Conversion Procedure 

Agency Revised Rule 



Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
RRC Objection 
Obj. Removed 



RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 



12/19:91 
11/21191 
12/19/91 
01/24 l 92 
11121/91 
12/19:91 



01/24:92 
01/24/92 
01/24 92 
01:24/92 
01/24/92 
01/24)92 
01/24 92 
01! 24 92 
01/24/92 
01/24/92 
01/24 92 
01! 24: 92 
01/24/92 
01/24 92 
01/24, 92 
01/24:92 
01/24:92 
01/24 92 
01:24 92 
01/24/92 
01/24/92 
01/24 92 
01/24, 92 
01 24 92 
01/24 92 
01/24/92 
01 24 92 
012492 
01/24/92 
01 24 92 
01/24 92 
01 24 92 
01/24 92 
01/24 92 
01 24 92 
01 24 92 
01, 24 92 
0124 92 
01, 24 92 
01 24 92 
01 24 92 
01 24 92 
01 24 92 
01 24 92 
01 24 92 



1732 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



RRC OBJECTIONS 



4 NCAC 16J .0003 - Waiver 

Agency Revised Rule 
4 NCAC 16K .0001 - Definitions 

Agency Revised Rule 
4 NCAC J6K .0005 - Books and Accounts 

Agency Revised Rule 
4 NCAC 16K .0009 - Self-Dealing 

Agency Revised Rule 
4 NCAC 16K .0010 - Custody of Investments 

Agency Revised Rule 
4 NCAC 16L .0004 - Waiver 

Agency Revised Rule 

EDUCATION 

Elementary and Secondary- Education 

16 NCAC 6D .0/03 - Graduation Requirements 
No Response from Agency 
Agency Revised Rule 

ENVIRONMENT, HEALTH, AND NATURAL RESOURCES 



RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 



01/24/92 
01/24/92 
01/24/92 
01/24/92 
01/24/92 
01/24/92 
01/24/92 
01/24/92 
01/24/92 
01/24/92 
01/24/92 
01/24/92 



A RRC Objection 9/19/91 

10/17/91 

Obj. Removed 12/19/91 



Coastal Management 

15 A NCAC 7H .0306 - General Use Standards for Ocean Hazard Areas 

Agency Responded 

Rule Returned to Agency 

Agency Filed Rule with OAH 
15 A NCAC 7 J .0402 - Criteria for Grant or Denial of Permit Applications 
15A NCAC 7M .0201 - Declaration of General Policy 

Agency Responded 

Agency Responded 

Rule Returned to Agency 

Agency Filed Rule with OA H 
15A NCAC 7X1 .0202 - Policy Statements 

Agency Responded 

Agency Responded 

Rule Returned to Agency 

Agency Filed Rule with OAH 
15A NCAC 7M .0303 - Policy Statements 

Agency Responded 

Agency Responded 

Rule Returned to Agency 

Agency Filed Rule with OAH 
15A NCAC 7M .0403 - Policy Statements 

Agency Responded 

Agency Responded 
15A NCAC 7M .0901 - Declaration of General Policy 

Agency Responded 

Agency Responded 

Rule Returned to Agency 

Agency Filed Rule with OAH 



RRC Objection 
No Action 

Eff. 

RRC Objection 
RRC Objection 
No Action 
No Action 

Eff. 

RRC Objection 
No Action 
No A ction 

Eff. 

RRC Objection 
No A ction 
No Action 

Eff 

RRC Objection 
No A ction 
No Action 
RRC Objection 
No A ction 
No A ction 

Eff. 



01/24/92 
01/24/92 
01/24/92 
03/01/92 
10/17191 
10/17/91 
12/19/91 
01/24/92 
01/24/92 
03/01/92 
10/17/91 
12/19/91 
01/24/92 
01/24/92 
03/01/92 
10/17/91 
12/19/91 
01/24/92 
01/24/92 
03/01/92 
10/17/91 
12/19/91 
01/24/92 
10/17/91 
12/19/91 
01/24/92 
01/24/92 
03/01/92 



Health: Epidemiology 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1733 



RRC OBJECTIONS 



15 A NCAC 19 A .0202- 

15 A NCAC 19H .0702- 

Agency Re\'ised Rule 

Sedimentation Control 



Control Measures - HIV 
Research Requests 



RRC Objection 10117/91 
RRC Objection 11/21/91 
Obj. Removed 12/19/91 



15 A NCAC 4 A .0005 - Definitions 

Agency Responded 
15 A NCAC4C .0007 - Procedures: Notices 

Agency Responded 

HUMAN RESOURCES 



RRC Objection 12/19/91 

No Action 01/24/92 

RRC Objection 12/19/91 

No Action 01/24/92 



Facility Services 

10 NCAC 3 J .2905 - Personal Hygiene Items 

10 NCAC 3W .0101 - State Cert for Labs Conducting Pap Smears 

Agency Revised Rule 
10 NCAC 3W .0201 - State Cert of Screening Mammography Svcs 

Agency Revised Rule 

Individual and Family Support 

10 NCAC42E .0905 - Personnel: Centers: Homes with Operator; Staff 
10 NCAC 42 E .0906 - Personnel: Day Care Homes: /Staff Person; Op 
10 NCAC 42E .1108 - Records 

Agency Revised Rule 
10 NCAC42E .1207 - Procedure 
10 NCAC42Z .0604 - Staff Requirements 
10 NCAC42Z .0901 - Procedure 

Mental Health: General 

10 NCAC 14S .0102 - Communication Rights 
Agency Responded 

10 NCAC 14S .0103 - thing Environment 
Agency Responded 

INSURANCE 

Life and Health Division 

// NCAC 12 .0507 - Fraternal Orders: Societies and Associations 
Agency Revised Rule 

11 NCAC 12 .0826 - Filing Requirements for Advertising 
Agency Revised Rule 

11 NCAC 12 .1202 - Dejinitions 

Agency Revised Rule 
11 NCAC 12 .1209 - Discrimination 

Agency Revised Rule 

LICENSING BOARDS AND COMMISSIONS 

Certified Public Accountant Examiners 



RRC Objection 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 



RRC Objection 
RRC Objection 
RRC Objection 
Obj. Removed 
RRC Objection 
RRC Objection 
RRC Objection 



10/17/91 
01/24/92 
01/24/92 
01/24/92 
0I/24;92 



01124/92 
01124/92 
01/24/92 
01/24/92 
01/24192 
01/24192 
01/24/92 



A RRC Objection 9/19i91 
10/17/91 

A RRC Objection 9/19/91 
10/17/91 



RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 
RRC Objection 
Obj. Removed 



12:1991 
01 ,24; 92 
01/24/92 
01/24/92 

12/19/91 
01/24/92 
12! 19 91 
01/24/92 



* 21 NCAC8G .0313 
Agency Responded 



Firm Name 



RRC Objection 10 17/91 
No Action 12/19/91 



1734 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



RRC OBJECTIONS 



Electrolysis Examiners 

* 21 NCAC 19 .0202 - Appi Licensure' /Electrologist Practicing/ 1/1/92 RRC Objection 11/21/91 

Agency Revised Rule Obj. Removed 12/19/91 

STATE PERSONNEL 

Office of State Personnel 

25 NCAC 1L .0301 - Purpose RRC Objection 11/21/91 

Agency Withdrew Rule 12/19/91 



6:22 NORTH CAROLINA REGISTER February 14, 1992 1735 



RULES INVALID A TED BY JUDICIAL DECISION 



1 his Section of the Register lists the recent decisions issued by the North Carolina Supreme Court, 
Court of Appeals, Superior Court (when available), and the Office of Administrative Hearings which 
invalidate a rule in the North Carolina Administrative Code. 



15A NCAC 7 J .0301 - WHO IS ENTITLED TO A CONTESTED CASE HEARING 

Thomas R. West, Administrative Law Judge with the Office of Administrative Hearings, declared Rule 
15A NCAC 07J .0301(b) void as applied in Lucy R. Hanson. Stanley P. and Jean C Szwed, Petitioners 
v. N.C. Department of Environment, Health, and Natural Resources, Division of Coastal Management, 
Respondent (91 EHR 0551, 91 EHR 0557). 

ISA NCAC 21D .0802(b)(2) -AVAILABILITY 

Robert Roosevelt Reilly Jr., Administrative Law Judge with the Office of Administrative Hearings, 
declared Rule 15A NCAC 21D .0802(b)(2) void as applied in Wilson's Supermarket jil2, Petitioner v. 
Department of Environment, Health, and Natural Resources, Respondent (91 EHR 0795). 

ISA NCAC21D .0805 - DECISION 

Thomas R. West, Administrative Law Judge with the Office of Administrative Hearings, declared Rule 
15A NCAC 21D .0805 void as applied in Glenn E. Davis Davis Grocery, Petitioner v. N.C. Department 
of Environment. Health, and Natural Resources, Dh-ision of Maternal and Child Health, WIC Section, 
Respondent (91 EHR 0694). 



1736 6:22 NORTH CAROLINA REGISTER February 14, 1992 



NORTH CAROLINA ADMINISTRA TIVE CODE CLASSIFICA TION SYSTEM 



The North Carolina Administrative Code (NCAC) has four major subdivisions of rules. Two 
of these, titles and chapters, are mandatory. The major subdivision of the NCA C is the title. 
Each major department in the North Carolina executive branch of government has been as- 
signed a title number. Titles are further broken down into chapters which shall be numerical 
in order. The other two, subchapters and sections are optional subdivisions to be used by 
agencies when appropriate. 

TITLE/MAJOR DIVISIONS OF THE NORTH CAROITNA ADMINISTRATIVE CODE 

TITLE DEPARTMENT LICENSFNG BOARDS CHAP i'F.R 

1 Administration 

2 Agriculture 

3 Auditor 

4 Economic and Community 

Development 

5 Correction 

6 Council of State 

7 Cultural Resources 

8 Elections 

9 Governor 

10 Human Resources 

1 1 Insurance 

1 2 Justice 

1 3 Labor 

14A Crime Control and Public Safety 

15A Environment, Health, and Natural 

Resources 

16 Public Education 

17 Revenue 

18 Secretary of State 
1 9A Transportation 
20 Treasurer 

*21 Occupational Licensing Boards 

22 Administrative Procedures 

23 Community Colleges 

24 Independent Agencies 

25 State Personnel 

26 Administrative Hearings 



Architecture 


2 


Auctioneers 


4 


Barber Examiners 


6 


Certified Public Accountant Examiners 


8 


Chiropractic Examiners 


10 


General Contractors 


12 


Cosmetic Art Examiners 


14 


Dental Examiners 


16 


Electrical Contractors 


18 


Electrologists 


19 


Foresters 


20 


Geologists 


21 


Hearing Aid Dealers and Fitters 


22 


Landscape Architects 


26 


Landscape Contractors 


28 


Marital & Family Therapy 


31 


Medical Examiners 


32 


Midwifery Joint Committee 


33 


Mortuary Science 


34 


Nursing 


36 


Nursing Home Administrators 


37 


Occupational Therapists 


38 


Opticians 


40 


Optometry 


42 


Osteopathic Examination and 


44 


Registration (Repealed) 




Pharmacy 


46 


Physical Therapy Examiners 


48 


Plumbing, Heating and Fire Sprinkler 


50 


Contractors 




Podiatry Examiners 


52 


Practicing Counselors 


53 


Practicing Psychologists 


54 


Professional Engineers and Land Surveyor: 


i 56 


Real Estate Commission 


58 


Refrigeration Examiners 


60 


Sanitarian Examiners 


62 


Social Work 


63 


Speech and Language Pathologists and 


64 


Audiologists 




Veterinary Medical Board 


66 



Note: Title 21 contains the chapters of the various occupational licensing boards. 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



1737 



CUMULA TIVE INDEX 



CUMULA TIVE INDEX 

(April 1991 - March 1992) 



1991 - 1992 



Pages 



AO - Administrative Order 

AG - Attorney General's Opinions 

C - Correction 

FR - Final Rule 

GS - General Statute 

JO - Judicial Orders or Decision 

M - Miscellaneous 

NP - Notice of Petitions 

PR - Proposed Rule 

SO - Statements of Organization 

TR - Temporary' Rule 



ADMINISTRATION 

State Construction, 465 PR 

State Employees Combined Campaign, 924 PR 

ADMINISTRATIVE HEARINGS 

Hearings Division, 310 PR 
Rules Division, 665 PR 



Issue 



1 - 44 1 - April 

44 - 99 2 - April 

100 - 185 3 - May 

186 - 226 4 - May 

227 - 246 5 - June 

247 - 325 6 - June 

326 - 373 7 - July 

374 - 463 8 - July 

464 - 515 9 - August 

516 - 677 10 - August 

678 - 721 11 - September 

722 - 783 12 - September 

784 - 923 13 - September 

924 - 980 14 - October 

981 - 1107 15 - November 

1108 - 1275 16- November 

1276 - 1300 17 - December 

1301 - 1423 18 - December 

1424 - 1503 19 - January 

1504 - 1562 20 - January 

1563 - 1636 21 - February 

1637 - 1741 22 - February 



1738 



6:22 NORTH CAROLINA REGISTER February 14, 1992 



CUMULA TIVE INDEX 



ADMINISTRATIVE ORDER 

Administrative Order, 926 AO 

AGRICULTURE 

Food and Drug Protection Division, 576 PR, 725 PR, 1303 PR 

Markets, 576 PR, 1642 PR 

North Carolina State Fair, 576 PR 

Pesticide Board, 725 PR 

Plant Industry, 102 PR, 469 PR, 576 PR, 1642 PR 

Structural Pest Control Division, 1569 PR 

Veterinary Division, 1645 PR 

CORRECTION 

Division of Prisons, 35 FR, 87 FR, 209 FR, 700 FR, 938 FR 

CRIME CONTROL AND PUBLIC SAFETY 

State Highway Patrol, Division of, 809 PR 

CULTURAL RESOURCES 

Archives and History, 932 PR 
State Library, 686 PR 

ECONOMIC AND COMMUNITY DEVELOPMENT 

Alcoholic Beverage Control Commission, 4 PR, 1648 PR 

Banking Commission, 1424 PR 

Community Assistance, 104 PR, 1579 PR 

Credit Union Division, 231 PR, 683 PR, 1108 PR 

Employment and Training, 590 PR 

Savings Institutions Division, 984 PR 

ENVIRONMENT, HEALTH, AND NATURAL RESOURCES 

Coastal Management, 299 PR, 1139 PR 
Departmental Rules, 1513 PR 

Environmental Management, 197 PR, 271 PR, 447 PR, 1061 PR, 1315 PR, 1520 PR, 1611 PR 
Forest Resources, 300 PR 

Governor's Waste Management Board, 1277 PR 
Health: Epidemiology, 28 PR, 341 PR, 735 PR, 1279 PR 
Health Services, 9 PR, 327 PR, 727 PR, 815 PR, 1452 PR 
Land Resources, 494 PR, 810 PR, 1720 PR 
Marine Fisheries, 122 PR, 690 PR 
Parks and Recreation, 693 PR 
Radiation Protection, 1367 PR 
State Registrar, 734 PR 
Water Treatment Facility Operators, 495 PR 

Wildlife Resources Commission, 84 PR, 170 PR, 198 PR, 301 PR, 647 PR, 692 PR, 1062 PR, 
1323 PR, 1542 PR, 1619 PR, 1637 C 

FLSAL DECISION LETTERS 

Voting Rights Act, 48, 230, 248, 326, 464, 516, 681, 722, 806, 927, 1301, 1505, 1566, 1640 

GENERAL STATUTES 

Chapter 150B, 784 GS 

GOVERNOR/LT. GOVERNOR 

Executive Orders, 1, 45, 100, 186, 227, 247, 374, 678, 804, 924, 981, 1276, 1504, 1563 

HUMAN RESOURCES 

Aging, Division of, 72 PR, 422 PR 
Blind, Services for, 686 PR 



6:22 NORTH CAROLINA REGISTER February 14, 1992 1739 



CUMULA TIVE INDEX 



Departmental Rules, 1114 PR 

Economic Opportunity, 604 PR, 689 PR 

Facility Sen-ices, 104 PR. 471 PR, 592 PR, 1035 PR, 1443 PR, 1584 PR 

Medical Assistance, 9 PR. 112 PR, 188 PR, 232 PR, 250 PR, 430 PR, 492 PR, 601 PR, 688 PR, 

726 PR, 807 PR, 932 PR, 1036 PR, 1277 PR, 1452 PR, 1703 PR 
Mental Health. Developmental Disabilities and Substance Abuse Services, 5 PR, 49 PR, 375 PR, 

449 FR, 1446 PR 
Social Services, 116 PR, 1039 PR, 1607 PR 

ENDEPENDENT AGENCIES 

Housing Finance Agency, 1484 PR 

Safety and Health Review Board of North Carolina, 1069 PR 

ENSURANCE 

Actuarial Services Division, 119 PR. 1060 PR 
Agent Services Division. 1056 PR, 1303 PR 
Engineering and Building Codes, 1704 PR 
Financial Evaluation Division, 933 PR, 1308 PR 
Life and Health Division, 430 PR, 1114 PR 
Property and Casualty Division, 1509 PR 
Special Services Division. 84 PR 

JUSTICE 

Criminal Justice Education and Training Standards, 607 PR 
Private Protective Services, 121 PR 
Sheriffs' Standards Division, 618 PR 
State Bureau of Investigation, 250 PR 

LABOR 

Boiler and Pressure Vessel, 1310 PR 

Elevator and Amusement Device Division, 1712 PR 

Occupational Safety and Health, 1138 PR. 1309 PR 

LICENSENG BOARDS 

Architecture, Board of 30 PR, 232 PR 

Certified Public Accountant Examiners, 201 PR, 935 PR, 1141 PR 

Cosmetic .Art Examiners. 653 PR. 1066 PR, 1723 PR 

Electrolysis Examiners, Board of, 737 PR 

Geologists, Board of, 654 PR 

Hearing .Aid Dealers and Fitters, 496 PR, 655 PR 

Landscape Contractors' Registration Board, 665 PR 

Medical Examiners, Board of, 304 PR, 363 PR, 935 PR 

Nursing. Board of. 305 PR 

Optometry. Board of Examiners, 1068 PR 

Pharmacy, Board of, 201 PR. 1480 PR 

Physical Therapy Examiners, Board of, 33 PR, 363 PR 

Practicing Psychologists Examiners, 203 PR 

Professional Engineers and Land Surveyors. 497 PR 

Real Estate Commission. 171 PR, 500 PR. 1546 PR 

LIST OF RULES CODIFIED 

List of Rules Codified. 89, 215. 314. 451. 504, 711. 907, 10S7. 1281, 1487, 1624 

PUBLIC EDUCATION 

Elementary and Secondary, 29 PR, 199 PR, 303 PR, 694 PR. 1140 PR. 1721 PR 

REVENUE 

Corporate Income and Franchise Tax Division, 816 FR 
Departmental Rules, 968 FR, 1729 FR 



l"40 6:22 NORTH CAROLINA REGISTER February 14, 1992 



CUMULA TIVE INDEX 



Individual Income, Inheritance and Gift Tax Division, 739 FR 

Individual Income Tax Division, 234 FR, 747 FR 

Intangibles Tax Division, 766 FR, 969 FR 

License and Excise Tax Division, 740 FR, 969 FR 

Motor Fuels Tax Division, 768 FR, 1620 FR 

Property Tax Commission, 210 FR 

Sales and Use Tax, 817 FR 

SECRETARY OF STATE 

Securities Division, 85 PR 

STATE PERSONNEL 

Office of State Personnel, 696 PR, 1082 PR, 1485 PR 
State Personnel Commission, 172 PR, 364 PR 

STATE TREASURER 

Retirement Systems, 736 PR 

STATEMENTS OF ORGANIZATION 

Statements of Organization, 518 SO 

TAX REVIEW BOARD 

Orders of Tax Review Board, 1641 

TRANSPORTATION 

Assistant Secretary For Management, 1254 FR 

Assistant Secretary For Planning, 1259 FR 

Departmental Rules, 1 142 FR 

Division of Highways, 1 146 FR 

Division of Motor Vehicles, 213 FR, 502 FR, 701 FR, 773 FR, 1229 FR, 1545 PR 



6:22 NORTH CAROLINA REGISTER February 14, 1992 1741 



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